BSA comments on bank rate cut

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Thursday, 07, Feb 2008 12:00

Commenting on the announcement today by the Bank of England to cut the Bank Rate by 0.25 percentage points to 5.25%, Brian Morris, Head of Savings Policy at the Building Societies Association, said:-

“Today’s rate cut shows that the Monetary Policy Committee recognises the challenges facing the economy in the year ahead. With the housing market slowing, this cut will be seen as a boost to the interests of homeowners.

“The cut will be particularly welcomed by those taking out a new mortgage and those coming off a fixed rate product. It will also provide support to people struggling to afford a home.

“In the current uncertain economic climate, it is important that homeowners ensure that they will be able to maintain mortgage repayments and that they contact their lender as soon as possible if they foresee any repayment problems.”

On the savings side, Mr Morris said:

“Building societies attracted record inflows of savings in the last few months of 2007, and will continue to offer some of the most attractive savings products in 2008. Given the recent falls in share prices, many households are likely to favour the security that cash savings accounts with building societies provide.”

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1. The Building Societies Association (BSA) represents all 59 building societies in the United Kingdom. Building societies have total assets of just under £325 billion and, with their subsidiaries, hold residential mortgages of around £250 billion, approximately 20% of the total outstanding in the UK. Societies hold just under £210 billion of retail deposits, accounting for about 20% of all such deposits in the UK. Building societies also account for over 37% of all cash ISA balances. Building societies employ over 50,000 full and part-time staff and operate through more than 2,100 branches.

2. Photographs of Brian Morris are available from the BSA press office, from the Association’s website at www.bsa.org.uk or from Headlinemoney www.headlinemoney.co.uk

3. A list of all building societies can be found on the BSA website at http://www.bsa.org.uk/aboutus/buildsocmember.htm and demutualised institutions at http://www.bsa.org.uk/consumer/factsheets/100010.htm

Neil Johnson

PR & Policy Manager

Building Societies Association

Tel : 020-7440 2260

E-Mail : neil.johnson@bsa.org.uk