BSA: Savings balances increase at mutuals in February

BSA: Savings balances increase at mutuals in February

BSA: Savings balances increase at mutuals in February

Important media note: From 1 March 2010, in relation to data for the month of January 2010 onwards, the Bank of England has combined figures for building societies and mutually owned banks. This new data is reported as the ‘mutual sector’. Previous data will not be restated and therefore it is not possible to make comparisons with previous periods. For more information about this change please see www.bsa.org.uk/feature

Savings balances increase at mutuals in February

Balances held in savings accounts at mutual institutions increased by
£807 million in February compared to reduction in balances of £467 million in January. After interest credited to accounts is excluded, mutuals had a net receipt of £623 million February.

Commenting on the savings figures, Adrian Coles, BSA Director-General,
said:

“It is encouraging to see the mutual sector attract a net inflow of retail deposits in February, ending a run of 11 monthly net withdrawals.
However, attracting funds in the retail market remains challenging, although we look forward to more normalised market conditions with the
removal of the 100% deposit guarantee of Northern Rock. It’s too
early to tell whether the inflow that mutuals received from savers this month is a one-off or if it represents a reversal of the recent trend of outflows.”

In the housing market, mutuals approved £1,389 million worth of loans in February, compared to £832 million in January, a 67% increase. Gross lending was £1,174 million in February, a 13% increase on the £1,039 million in January.

Commenting on the lending figures, Mr Coles said:

“The housing market is making small steps to a recovery, but lending figures are still subdued in comparison to previous years. Approvals and gross lending did improve in February, but January was a particularly sluggish month due to the poor weather conditions, and a surge of completions in December as the stamp duty holiday was coming to an end.”

Mutual statistics February 2010

Data below are not seasonally adjusted.

¿ Mutuals’ gross lending amounted to £1,174 million in February 2010 compared to £1,039 million in January.
¿ Net lending by mutuals in February 2010 was -£830 million compared to -£819 million in January.
¿ Approvals by mutuals in February 2010 were £1,389 million compared to £832 million in January.
¿ Mutuals had a net receipt of £623 million in February 2010 compared to a net withdrawal of £741 million in January.
¿ Mutuals had a net withdrawal of £109 million from cash ISAs in February 2010 compared to a net withdrawal of £180 million in January.

~ Ends ~

Notes to editors

1. Detailed statistical tables accompany this press release.

2. The Building Societies Association (BSA) represents mutual lenders and deposit takers in the UK including all 52 UK building societies.
Mutual lenders and deposit takers have total assets of almost £375 billion and, together with their subsidiaries, hold residential mortgages of almost £240 billion, 19% of the total outstanding in the UK. They hold over £245 billion of retail deposits, accounting for just under 22% of all such deposits in the UK. Mutual deposit takers account for about 36% of cash ISA balances. They employ approximately 50,000 full and part-time staff and operate through approximately 2,000 branches.

3. Photographs of Adrian Coles are available from the BSA press office, or from the Association’s website at www.bsa.org.uk or Headlinemoney www.headlinemoney.co.uk

for further information, contact:

Rachel Le Brocq
Press and Public Affairs Manager
The Building Societies Association
6th Floor, York House
23 Kingsway, London
WC2B 6UJ

Tel: 020 7520 5905
Mobile: 07773489644
Fax: 020 7240 5290
www.bsa.org.uk