Regulation is getting friendlier – but NatWest’s Lloyd Cochrane warns today’s fast‑changing rulebook is piling pressure on brokers
NatWest’s Lloyd Cochrane believes the UK’s regulatory environment for mortgages has become more “supportive” in the past year – but says the sheer variety and pace of change still leaves many brokers grappling with complexity.
Cochrane, who leads NatWest’s mortgage, home insurance and life insurance products, oversees strategy, customer proposition and lending criteria across a business with about 1.3 million mortgage customers, 19 million retail customers and around £200 billion of balances.
Speaking to Mortgage Introducer, he described recent interventions from the FCA and PRA as broadly positive for borrowers and intermediaries alike – but warned that multiple rulemakers pulling in different directions can still make it difficult for brokers to join the dots.
A more supportive regulatory framework
Asked how he would describe the regulatory backdrop over the past year, Cochrane said he would “characterise it as supportive with three main elements to it.”
“The first element is the FCA,” he explained. “We support lending more to the right customers by adjusting the stress rates we apply. This follows discussions with the FCA, where we and others highlighted cases in which customers could clearly afford to borrow more than the rules allowed us to lend. As a result, there was untapped potential among some customers.”
The second element, he said, has been less widely reported but could prove more significant over time. Historically, Cochrane explained, the rules made it difficult to combine digital and human elements within a single customer journey.
“[The rules] required you to create a journey for a customer that combined digital and non-digital,” he recalled. “There was previously a barrier which was that as soon as you spoke to a human in your mortgage process, you were in 'advice' — and you couldn’t get out of advice and carry on with your digital application.”
That has now changed. “The FCA have taken that wall down,” he said. “And that’s great today. But as we think about how AI can help us to help customers, that’s even better for tomorrow.”
The final element concerned the PRA and the Bank of England, specifically changes to the loan-to-income limits. “There used to be an artificial constraint for customers. It’s now more personalised, and that’s really key,” Cochrane said.
Together, these shifts meant that regulation had become more enabling for customers, even if the overall landscape remained demanding to navigate.
Intimidated customers, policy turbulence and broker pressure
Cochrane was keen to stress that the home-buying process is daunting for most consumers even before regulation enters the picture.
“Let's start from the point — and I know brokers do too — that customers are intimidated by buying a home,” he said. “They’re intimidated by a mortgage. For almost everyone, it’s the biggest commitment they’ll ever take on: it’s a massive debt that lasts for most of their working life.”
On top of that baseline anxiety, he acknowledged the “policy turbulence” that brokers often complain about.
“When you add in all of the changes that are happening — mostly for the good over the last few years — it just makes it that much more confusing,” he said.
“I think it is hard for brokers,” he said, “because of the different directions that rules come from.”
How lenders can help brokers cut through the noise
For Cochrane, that environment creates a shared responsibility between lenders and intermediaries.
“What that means for us and for brokers — what that means for us as a community, if you like — is that our first job is to make it as simple and easy as possible for a customer to understand the process and get into their home,” he said.
He argued that major lenders have a particular duty to support brokers.
“As a lender, we can help brokers by explaining our policies really clearly and really simply, avoiding jargon and unnecessary complexity,” he said. “We can use tools — affordability tools, illustration tools — to make things visual, to turn a complex idea into a customer outcome. What this means for a customer is the following additional lending or the following cost.”
Availability was another theme.
“Additionally, it’s about making ourselves available to brokers in as many ways as possible,” he said. “So we have a BDM salesforce that are regularly out and about talking with brokers on the ground. We’ve got web chat. We recently introduced a WhatsApp channel, so brokers can engage with us via WhatsApp to answer those questions.”
Beyond day-to-day support, he also saw a strategic role for large lenders in shaping the rules themselves.
“We have a role as a leader in the industry in talking to regulators publicly and privately,” he said. “One of the things that — and with government too — that we look to try and do is set out data-based arguments as to how we can help more customers.”
He felt regulators had generally responded well.
“I think the regulators have done a good job in consulting before they impose,” he said, adding that “as much as possible” they try to coordinate so that “you don’t get one set of rules coming in one week that are slightly contradictory to another set of changes that come in next week.”
“Hard for brokers” – but moving in the right direction
Cochrane did not minimise the pressure on advisers. The volume of material, the range of sources — FCA, government, PRA and others — and the underlying anxiety around homebuying have created what he called a “hard” environment for brokers.
At the same time, he sees genuine progress. Changes to stress tests, the removal of the “wall” between advice and digital journeys, and a more personalised approach to loan-to-income limits all point, in his view, towards a framework that is more supportive of the right kind of lending.
Ultimately, he suggested, the test of regulation is not only whether it protects consumers in theory, but whether in practice it allows the right customers to access sustainable borrowing and understand the commitments they are taking on. That is where brokers and lenders, working together, can turn a complex set of rules into clearer, better outcomes on the ground.
