Alastair Hazell, Banking Director at Hampden & Co, discusses how Hampden & Co’s understanding of barristers’ unique circumstances means they can provide flexible solutions.
As barristers progress through their careers they typically take on larger and longer cases with higher fees. While this is generally very welcome, delays in collection of these fees can often have unintended consequences that make the management of personal finances a less welcome challenge. This frequently occurs at the time that young families are growing and the size of mortgages are increasing to purchase larger homes.
In addition to these pressures, school fees can appear to be rising steeply, and that escalation increases as second children start school. Subsequent to schooling, many barristers that I talk to then wrestle with whether they want to become the latest branch of the Bank of Mum and Dad. An alignment of circumstances such as these can help make for the “Perfect (Financial) Storm” – at a time when barristers are rightly wanting to concentrate on their case load.
The changing face of banking
Against these relentless demands on the household exchequer, barristers’ income is inevitably sporadic, as invoices are paid on a rolling, but irregular basis.
In the early 1990s, when I started my banking career in Chancery Lane, there was a fairly high density of branches of all the High Street banks in the immediate vicinity of the Inns of Courts (the bank I worked for had five alone). In those days branches were staffed by Bank Managers who often had both the experience and discretion to consider and approve requests for borrowing facilities, including Mortgages.
With the gradual demise of the local – and empowered – Bank Manager, and the ongoing programme of branch closures, lending decisions are inevitably tending to be taken remotely, driven by codified credit models which typically do not respond well to irregular circumstances. There is an uncomfortable reality that any applications for credit can be treated like all other “self-employed” requests, rather than being considered on their unique merits, as befits the profession.
Treating every situation as unique
Clearly no two Chambers are the same, and the circumstances and financing requirements of no two barristers will be the same, even if they are of similar seniority and in the same set.
A younger barrister may only need to borrow limited sums on an unsecured basis to help with the day-to-day, whereas for the longer established individual they may be looking for a more creative package of arrangements that are made on a secured basis and with commensurate finer pricing.
As an example, I have recently created a solution for a barrister and his wife, comprising an Interest-Only Home Loan of £650,000 in joint names, with an additional £450,000 revolving as an overdraft, in the barrister’s sole name, both elements secured against their home. This arrangement was developed in consultation with their accountant, to optimise tax efficiency. The overdraft provides our client with the flexibility to borrow in case of need without having to approach the bank every time, and with interest only payable on the amount actually borrowed on a daily basis.
Developing bespoke relationships with clients is crucial and demonstrates a level of understanding that sets private banking apart. To assist in achieving this, at Hampden & Co we ensure clients have direct telephone and email access to their individual Banking Director.
None of the Banking Directors are confined to the office and I frequently visit clients at Chambers, to minimise any disruption to busy schedules. At Hampden & Co, we understand the real world in which barristers operate, and I aim to create flexible solutions that reflect every client’s unique needs.