BSA: Mortgage approvals by mutuals jump 29% in March

Wednesday, 4 May 2011 12:00 AM

Mutuals approved £2.1 billion worth of mortgages in March 2011, which is up 29% on the £1.7 billion approved in March 2010 and compares to £1.7 billion in February 2011. Gross lending by mutuals totaled £1.7 billion in March 2011. This is up 8% compared to £1.6 billion in March last year, and compares to £1.5 billion of lending in February this year.

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

"There was a significant rise in the value of mortgages approved by mutuals in March. Indeed, across the first quarter of 2011 mortgage approvals by mutuals were 28% greater than in the same period a year earlier. "However, these are increases from very low levels, and compared to previous times activity in the mortgage market remains subdued. This is largely because economic uncertainty continues to affect confidence in the housing market."

Savings balances held at mutuals increased by £273 million in March, compared to an increase of £534 million in March 2010. After interest credited is excluded, mutuals had a net withdrawal of £604 million in March this year.

Mr. Coles said:

"Savings balances at mutuals grew in March, although once interest credit is excluded, there was a net withdrawal from savings accounts. Although interest rates may rise later in the year which may encourage more saving, household finances continue to face significant pressures. Households' ability to save is under strain from above target consumer price inflation, which is higher than the rate of wage growth, and the recently implemented austerity measures."

Mutual statistics March 2011
Data below are not seasonally adjusted.

. Mutuals' gross lending amounted to £1,736 million in March 2011 compared to £1,605 million in March 2010.
. Net lending by mutuals in March 2011 was -£476 million compared -£765 million in March 2010.
. Mortgage approvals by mutuals in March 2011 were £2,145 million compared to £1,666 million in March 2010.
. Savings balances at mutuals increased by £273 million in March 2011 compared to an increase of £534 million in March 2010.

. There was a net withdrawal of £604 million from savings accounts held with mutuals in March 2011 compared to a net withdrawal of £318 million in March 2010.

. Mutuals had a net receipt of £620 million into Cash ISAs in March 2011 compared to a net receipt of £210 million in March 2010.

~ Ends ~

Notes

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 48 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 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

Contact

Please note the BSA press office are currently in Birmingham at the BSA Annual Conference. For queries please call Rachel Wylie on 07773 489644 or reply to this email.

Katie Errington

Policy and External Affairs Officer
Building Societies Association
6th Floor, York House
23 Kingsway
London
WC2B 6UJ

Tel: 020 7520 5904
Fax: 020 7240 5290
Email: katie.errington@bsa.org.uk
Web: www.bsa.org.uk

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