BSA: Mortgage lending grows again at mutuals

Gross mortgage lending by building societies and other mutual lenders was £2.5 billion in September which is up by 10% compared to the same month last year. Mutuals took a 22% market share of gross lending in September, up from 17% in September 2011, and took a 21% share of lending in the first nine months of the year.

Net mortgage lending (gross lending minus repayments) by mutuals was £0.5 billion in September, and £4.9 billion in the first nine months of the year.

Retail savings balances at mutuals fell by £0.2 billion in September 2012, compared to an increase of £0.6 billion in the same month last year. In the third quarter savings balances held with mutuals increased by £2.2 billion, compared to a £1.6 billion increase in the third quarter of 2011.

Commenting, Adrian Coles, Director-General of the Building Societies Association, said:

"These lending figures show that building societies and other mutuals are continuing to increase their lending to help people buy their homes. Net mortgage lending by mutuals was £4.9 billion in the last nine months, out of £6.0 billion across the market as a whole.

"The funds from the Bank of England's Funding for Lending Scheme will take some time to be drawn and flow through into the mortgage market. As the scheme is favourable to institutions which are looking to increase their lending, it will clearly appeal to many mutual lenders.

"Savings balances at mutuals fell slightly in September, which follows two consecutive months of particularly strong inflows into deposit accounts. Conditions in the labour market appear to be improving and consumer price inflation has reduced over recent months. Both these factors should reduce the pressure on household finances and help households to save more in coming months."

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Hilary McVitty
Tel: 020 7520 5926

Notes for Editors:

Mutual statistics September 2012 – data is not seasonally adjusted.

Additional data tables are attached.

1. The Building Societies Association (BSA) represents mutual lenders and deposit takers in the UK including all 47 UK building societies. Mutual lenders and deposit takers have total assets of over £375 billion and, together with their subsidiaries, hold residential mortgages of £245 billion, 20% of the total outstanding in the UK. They hold more than £250 billion of retail deposits, accounting for 22% of all such deposits in the UK. Mutual deposit takers account for 31% of cash ISA balances. They employ approximately 50,000 full and part-time staff and operate through approximately 2,000 branches.

2. Data in this release relates to 47 building societies and four other mutual deposit taking and lending institutions in the UK.

3. Photographs of Adrian Coles are available from the BSA press office, or from the Association's website at or Headlinemoney

4. Follow the BSA on Twitter @BSABuildingSocs

Katie Wise
Policy and External Affairs Officer
Building Societies Association
6th Floor, York House
23 Kingsway

Tel: 020 7520 5904
Twitter: @BSABuildingSocs