BSA: Mutuals continue to grow mortgage lending in January

Gross mortgage lending by building societies and other mutual lenders was £2.4 billion in January, up by 25% compared to the same month last year. Mutuals took a 21% market share of gross lending in January, up from 18% in January 2012.

Net mortgage lending (gross lending minus repayments) by mutuals was £394 million in January compared to £16 million in the same month last year.

Mutuals approved a total of 20,979 loans in January, up 30% compared to the 16,162 in the same month last year and higher than the 18,607 loans approved in December 2012.

Retail savings balances at mutuals fell by £0.8 billion in January, compared to a reduction of £1.1 billion in the same month last year.

Commenting, on the figures Paul Broadhead, Head of Mortgage Policy said:

"Mortgage lending by building societies and other mutual lenders continued to grow in January, whilst lending across the rest of the market remained roughly flat. Mutuals accounted for 21% of total lending in the month across the UK.  This follows a year in which the sector grew its mortgage lending by 30% and helped over 65,000 first-time buyers.

"A number of societies have just released strong financial results for 2012 showing they are in a good position to lend in the coming year. Many mutuals are also signed up to the Bank of England's Funding for Lending Scheme, which will assist the sector to provide mortgage finance at competitive rates to homebuyers."

"Savings balances held by mutuals fell in January, as they did in January last year. It is common for there to be an outflow from savings accounts at this time of year as households repay debts accumulated over the Christmas period. However, savers do face another challenging year. Consumer price inflation remains above the 2.0% target and the Bank has forecast that it will increase towards 3.0% this year.

"Meanwhile growth in average earnings has weakened, putting additional strain on household budgets. Mutuals are acutely aware of the difficulties that savers face and work hard to meet their needs whilst balancing the needs of their borrowing members".

~ Ends ~

Hilary McVitty
Tel: 020 7520 5926

Notes for Editors:

Mutual statistics January 2013 – 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 46 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 46 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