Bank launches £1m mortgage for the bonus-rich

As the rest of Britain tightens its belt, a private bank has launched a £1m-plus mortgage aimed at bankers who are expecting to receive juicy bonuses.

Investec Private Bank is targeting people with “sustainable overall earnings in excess of £300,000 a year and an established personal net worth in excess of £3 million" who are looking to borrow a minimum of £1 million.

The bank will lend against the property being bought, but will also take into account other assets such as shares.

Jack Jones, of Investec Private Bank, said: “We expect our product to be particularly popular among City professionals, many of whom are set to receive sizeable bonuses over the coming months as part of their overall remuneration packages.

“A number of these individuals struggle to get mortgages and other personal loans approved, as many banks are geared towards far less flexible lending criteria and are not easily able to create bespoke offerings for individual clients.”

Investec has launched the product after carrying out research in October into bonus expectations.

Of the 100 City workers questioned, it found that three-quarters are expecting a bigger bonus this year than last.

Total City bonuses for this year are estimated at around £7bn. Most bonuses are paid out between the New Year and March.

But as estate agents in prime central London and the leafiest parts of the home counties brace themselves for a spending spree, City bankers could find themselves struggling to find suitable property.

In central London, there is a shortage of quality properties because of strong foreign demand fuelled by the weak pound. Knight Frank estimates that overseas buyers are purchasing 60% of luxury homes in London.