BBA reveals drop in gross mortgage lending
Bankers’ data shows that businesses and households “continue to be cautious” about their finances in the face of difficult economic times.
Gross mortgage lending of £7.9bn in February 2012 was 1.9 per cent less than 12 months ago and below the recent six-month average, data from the British Bankers’ Association has shown.
The data, published today (23 March), showed that capital repayment by householders remains at a high level, with a net mortgage lending increase of £500m in February.
In February, house purchase approvals dropped back to “more normal trend levels” as demand from buy-to-let investors and first-time buyers, seeking to buy before the stamp duty exemption ends in March, fell back.
The average house purchase mortgage of £146,000 was 5 per cent more than a year earlier.
The data also showed the number of remortgaging approvals was at the lowest level for 13 years.
Demand for borrowing from industry also remained subdued in February as economic concerns and impaired confidence impacted on business growth and borrowing attitudes.
David Dooks, statistics director of the BBA, said: “Businesses and households continue to be cautious about their finances in the face of difficult economic times and this shows up in a reluctance to take on new credit, or where possible, seeking to pay back bank borrowing.
”Confidence will be helped in the coming months by official schemes to support the mortgage market and stimulate business demand for credit.”