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Lending by mutuals continues to rise

Lending by mutuals continues to rise

Category: Mortgages

Updated: 31/05/2013
First Published: 31/05/2013

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Gross mortgage lending by building societies grew to £3.2 billion during last month, representing an annual increase of 55% since April 2012.

Figures issued by the Building Societies' Association (BSA) found 30,651 home loans were approved by mutuals last month, worth a total value of £3,665 million, compared to the £2,595 million lent in the same month last year.

Building societies continued to seize a larger portion of the mortgage market, with total market share reaching 26%, up from 21% the previous year.

More people appear to be investing their savings with building societies, with total balances held with mutuals reaching £972 million.

The value of savings balances held in building society accounts soared by £2.6 billion (net) during the first four months of the year, compared to a reduction of £1.4 billion in the same period last year.

Adrian Coles, director-general of the BSA, said: "One reason for the substantial rise this month particularly is that 31 March 2012 marked the end of the stamp duty holiday for first time buyers.

"Following last year's trend, mutual lenders are still delivering the majority of additional lending into the market as other providers have continued to de-leverage their balance sheets.

"Despite the downward pressure on savings rates from the Funding for Lending scheme, building societies and other mutuals experienced strong inflows into savings accounts in April, building on a strong March performance," he added.

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