BSA: Mortgage lending by mutuals grows 10% in September

BSA: Mortgage lending by mutuals grows 10% in September

BSA: Mortgage lending by mutuals grows 10% in September

Gross mortgage lending by mutuals was £2.2 billion in September, which is 10% greater than the £2.0 billion lent in August. Mortgage approvals made in September amounted to £1.9 billion, a slight increase on the £1.8 billion approved in August.

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

“Although the mortgage market remains relatively weak, mutual lenders have seen a slight increase in lending over recent months. However, recent reports of house price declines are likely to reduce demand for house purchase, and the effects of the Spending Review may also weigh on buyers’ confidence.”

Savings balances held at mutuals decreased by £569 million in September, following a decrease of £699 million in August. Excluding interest credited to accounts £819 million was withdrawn in September, compared to £1,023 million in August.

Commenting on the savings data, Adrian Coles said:

“The economic outlook remains challenging for households. The labour market remains weak, causing earnings to grow at a rate below current price inflation. It is therefore particularly hard in the current low interest rate environment to attract households to save.”

Mutual statistics September 2010

Data below are not seasonally adjusted.

. Mutuals’ gross lending amounted to £2,176 million in September 2010 compared to £1,973 million in August.

. Net lending by mutuals in September 2010 was -£12 million compared to -£278 million in August.

. Mortgages approvals by mutuals in September 2010 were £1,912 million compared to £1,781 million in August.

. Savings balances at mutuals decreased by £569 million in September 2010, compared to a decrease of £699 million in August.

. Mutuals had a net withdrawal from savings accounts of £819 million in September 2010 compared to a net withdrawal of £1,023 million in August.

. Mutuals had a net receipt of £194 million into Cash ISAs in September 2010 compared to a net withdrawal of £43 million in August.

Important media note: For data relating to 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 years. For more information about this change please see www.bsa.org.uk

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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 49 UK building societies. Mutual lenders and deposit takers have total assets of over £365 billion and, together with their subsidiaries, hold residential mortgages of almost £235 billion, 19% of the total outstanding in the UK. They hold more than £245 billion of retail deposits, accounting for 21% 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

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