Joining in the same week that Northern Rock collapsed, he was faced not only with the daunting task of winning over his newly adopted local community but also in navigating the survival of a then 137-year old organisation in turbulent times.
Coincidentally, Mr Robinson happened to be in Northern Rock’s hometown of Newcastle upon Tyne on the day savers began to form unforgettably long queues outside its branches, and he admitted to calling his new employers to confirm the same was not happening at Market Harborough.
Luck
Luckily for him, and its 50,000 members, the Leicestershire building society was unaffected by the turmoil, though that did not stop him from getting to work on strategy to make sure the lender could withstand a similar crisis.
He said: “The thing for me was to make sure we were in good shape by avoiding the pitfalls, such as not lending on stuff we didn’t understand and not having investments in counterparties that were problematic. It was also important to not have a balance rate that was skewed to base rate tracker mortgages.”
After surviving his first big test, Mr Robinson felt confident he had gone some way in impressing those initially sceptical about handing responsibility for the top job to an outsider.
Although he confessed that his identity as a “stranger” made the job slightly more challenging, he added that today it is perfectly normal for building societies to look further afield for suitable chief executives.
He said: “Back in the history of building societies they would have been, like brewries, run by locals. Those days are gone. It is now a national market and from the building society perspective it is more important that we get in the right people.
“There was a short handover period and it is an interesting challenge to come in as a ‘stranger’ to any organisation as a chief executive. You may not have a lot of knowledge in terms of the history of the organisation, but that can also be an advantage. Sometimes the dumb questions are the smart questions.”
After six years at the helm Mr Robinson has become more familiar with Market Harborough’s story and values, which he said are very similar in nature to the rest of the country’s mutual organisations. Though not able to recount the exact details of how his current employer was conceived, he compared it to the other building societies of the Victorian era that were each part of a social movement that promoted the idea of “each man owning his own home”.
He said that the objective of giving people a way to save and a means to access home finance is still very much at the core of Market Harborough’s values in the 21st century, regardless of how much the UK economy has changed since the mutual was founded in 1870.
But more important than simply providing the right type of products, Mr Robinson explained that the lenders’ independent status means simply doing more for each and every one of its members.
This responsibility, he continued, is especially felt by the chief executive, who he said takes on the role of “trustee” and “custodian of value” within a building society. Because of these added obligations, he confirmed that the people in charge faced enormous pressures to leave operations in better shape than before.
He added: “Though not necessarily always the cheapest, member-owned businesses are all about delivering tailored products with value-added service. We are not profit maximisers, we are here for the long-term. We do not feel the need to deliver on a huge scale. We are not a massive factory that needs to process thousands of widgets. Strategically that is not what we do.
“We aim to have individual conversations with people and look to create solutions. This is not achieved by our product set, but by detailed conversations and understanding. We are more at the bespoke Savile Row end of the market, as opposed to one that gives one-size-fits-all solutions.
Our customers would rather spend a few basis points more on their mortgage than have a stressful post-sales experience.”
Looking critically at high street banks, Mr Robison said that clients of Market Harborough and other building societies were prepared to pay a premium for extra service, whereas banks add small print and “take ages to resolve complaints”.
He said building societies remained strong across the UK because they are trusted.
Trust and strong rapport were also created by engaging with the local community, with a number of charity events and generous donations taking place every year. Aside from buying a Christmas tree for the town square and lending small sums to the entrepreneurial population, the building society also launched affinity accounts and opened a charity foundation.
Moreover, each year staff at the building society are invited to take the day off to pursue a charity-related fundraising event of their personal interest. In the past this has included employees making things at home and then taking the day off to sell them, with all proceeds going to charity.
Innovative products also go a long way in satisfying local needs. Described by Mr Robinson as a “diversified economy”, he said that the demographic of Market Harborough included the old and wealthy, commuters to London and those struggling to get by.
In response to these varied concerns and economic circumstances, he mentioned a number of different initiatives currently offered: “On the mortgage side we tend to help families who are struggling to buy their first home. There is a cascade of wealth from older generations to younger ones and we offer things like shared mortgages and guarantor mortgages to bring the LTV down.
“Looking at other niche products, what you have got is a lively buy-to-let market at the moment and there is quite a demand for that, particularly from older folks. House prices have firmed here, but smaller houses, like two or three-bed terraces, have gone up in value because of the buy-to-let boom.”
Bubble
As many would expect from his role, Mr Robinson has kept a close eye on the recovering housing market and was relieved to see that the London housing ‘bubble’ had not reached commuter towns such as Market Harborough.
He said that keeping local prices stable was fundamental at this stage, before adding that Market Harborough was not massively keen on offering 95 per cent LTV and still unsure about the government’s Help to Buy scheme.
Apart from a few uncertainties, however, Mr Robinson is now looking forward to the second phase of his tenure in a more economically stable Britain.
After enduring a rocky start to his first job as chief executive at a building society, he is confident that a return to market clarity over the next 48 months will present him with the ideal opportunity to drive Market Harborough Building Society forward, now in its 144th year.
Daniel Liberto is a features writer of Financial Adviser
Key Points
Mark Robinson became chief executive of Market Harborough Building Society just as dark clouds gathered around Northern Rock in 2007.
The objective of giving people a way to save and a means to access home finance is at the core of Market Harborough’s values in the 21st century
Trust and strong rapport is also central and achieved by engaging with the local community
