* Total net sterling lending to the UK private sector increased by an underlying £8.0bn (+0.9%) to £941bn, after allowing for the acquisition of a consumer credit book and securitisations of mortgages and card borrowing. This was slightly more than the previous month’s rise of £7.7bn, though much in line with the recent monthly average.
* Mortgage lending rose by an underlying £5.5bn in September, marginally more than in July or August. An underlying overall rise in unsecured personal lending of £0.9bn was also slightly above the recent monthly average of £0.8bn. Within this, stronger growth in card borrowing offset weaker demand for personal loans and overdrafts.
* Overall lending to the financial sector rose in September, more than reversing a contraction in August. Lending to securities dealers rose by £1.7bn, as their borrowing requirements increased and, although lending to investment & unit trusts also rose, by £0.6bn, this was offset by a net repayment from leasing companies. For the non-financial part of the economy, lending to real estate continued to grow strongly and lending to hotels & restaurants increased, but in contrast there was a net repayment from the transport & communications sector and manufacturers reduced their borrowing sharply.
* Deposits from the private sector were not as strong as the recent average, rising by £3.1bn (+0.5%). Around half of the increase reflected personal deposits, though these were noticeably weaker than in the previous two months.
David Dooks, BBA director of statistics, said:
"The high numbers of mortgage loans approved in recent months have led to the continued buoyant lending picture seen in September. The consumer credit market also remains strong, though overall growth so far this year is actually lower than in the comparable nine months of last year.
Growth in company lending was towards other financial companies, hotels and real estate, while other sectors, manufacturers in particular, are reducing their borrowings."
Analysis of MBBG sterling lending to UK public and private sectors
* Lending to individuals (after allowing for securitisations, loans removed from special purpose vehicles, transfers, acquisitions, etc )
Net lending rose by £6,357mn in September, compared to £6,126mn in August and +£5,689mn in September last year. Mortgage lending accounted for £5,469mn of the rise, compared to August’s +£5,305mn. Other forms of personal credit saw loans and overdrafts rising by £400mn, while card borrowing rose by £487mn.
* Lending to financial firms
The fluctuating monthly requirements of securities dealers was again apparent in September, as their borrowing rose by £1,733mn, partly reversing a repayment in August. Increased lending to investment & unit trusts (+£654mn) and insurance companies (+£214mn) was partly offset by repayments from leasing companies (-£695mn).
* Lending to non-financial firms
Continuing the pattern seen for some time, lending to real estate was the most substantial increase, rising by £1,067mn, whilst lending to hotels & restaurants (+£334mn) was the only other sector increasing its borrowing. There were widespread net repayments from other sectors, the notable ones being the transport, storage & communication sector (-£259mn) and manufacturers (-£724mn, largely chemical companies and miscellaneous manufacturers).
