BSA: Mutuals’ gross lending and savings continue to strengthen
Tuesday, 30 August 2011 11:39 AM
Lending and savings at mutuals are bucking the trend in challenging economic conditions according to data published today. Gross lending is at a 10 month high.
Lending:
? 6% rise in gross mortgage lending by mutuals in July, up to £2.1 billion from £2.0 billion in July 2010.
? 17% increase in gross lending for the first seven months of 2011 standing at £12.3 billion (£10.5 billion, January - July 2010).
? £1.9 billion of mortgages approved by mutuals in July, on a par with July 2010.
? 16% rise in mortgage approvals for the first seven months of 2011 at £12.5 billion (£10.8 billion, January - July 2010).
Savings:
? Savings balances up £0.6 billion in July 2011, compared to a reduction of £1.0 billion in July 2010 last year.
? Excluding interest credited to accounts, mutuals saw a net receipt of £0.4 billion, compared to a net withdrawal of £1.3 billion at the same time in 2010.
Commenting, Adrian Coles, Director-General of the Building Societies Association, said:
“Lending by mutuals is showing continued signs of strength in a relatively difficult operating environment. Gross lending by mutuals in July was at its highest level since September 2010, and in the first seven months of the year mutuals have approved an additional 16% worth of mortgages compared to the same period last year. This is an encouraging trend in the face of continued uncertainty in the outlook for the housing market given the challenges faced in the wider economy.”
“Similarly it is encouraging to see a net receipt of savings by mutuals in July, especially when the ability of many households to save is being eroded by persistently high inflation and low wage growth. A recent deterioration in labour market conditions has added to the pressure for many households, and may further dampen consumer confidence. Consequently, total household savings in 2011 are likely to be significantly lower than last year. Mutuals, however, may benefit from any consumer withdrawal from equity investments as a consequence of current share-price volatility.”
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Press contacts:
Hilary McVitty and Rachel Wylie
Tel: 020 7520 5626 / 5905
Email: hilary.mcvitty@bsa.org.uk / rachel.wylie@bsa.org.uk
Notes to editors
Mutual statistics July 2011 - further detailed statistical tables accompany this press release.
Data is not seasonally adjusted.
? Mutuals’ gross lending amounted to £2,115 million in July 2011 compared to £1,995 million in July 2010.
? Net lending by mutuals in July 2011 was -£155 million compared -£372 million in July 2010.
? Mortgage approvals by mutuals in July 2011 were £1,891 million compared to £1,940 million in July 2010.
? Savings balances at mutuals increased by £575 million in July 2011 compared to a reduction of £1,034 million in July 2010.
? There was a net receipt of £387 million into savings accounts held with mutuals in July 2011 compared to a net withdrawal of £1,306 million in July 2010.
? Mutuals had a net withdrawal of £220 million from cash ISAs in July 2011 compared to a net withdrawal of £129 million in July 2010.
1. 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 35% 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 all 48 building societies and five other mutual deposit taking and lending institutions.
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
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