Overall consumer credit was little changed and personal deposits remained weak. Lending to non-financial companies fell by about £1.0 billion, largely reflecting the unwinding of takeover finance.
The number of mortgages approved for house purchase was 26,097 in March down slightly on the 28,024 in February, however it is still above the six month average of 23,152.
Remortgaging continued it's decline with 26,831 loans in March compared to 28,237 in February and a six month average of 36,998.
Loans for equity withdrawal and other purposes average £28,400 in March which is only marginally down on the £28,700 that was averaged in March 2007 before the credit crunch. There were 21,336 such loans in March compared to 22,727 in February and a six month average of 23,485.
BBA statistics director, David Dooks, said of the latest data: “Lending to households continues to grow, as banks make funds available for people who meet their lending criteria but consumer confidence is fragile and unlikely to change demand markedly in the near-term. The banks’ figures also show it would be unrealistic to expect the mortgage market to recover in a steady and consistent way in the current economic environment.
“Company demand for increased bank finance is subdued, as large corporates seek alternative funding sources and small businesses operate out of cash-flow during this recession.”
Nicholas Leeming, director of propertyfinder.com, commented "Confidence in the housing market is improving, but restrictions on mortgage supply are still making it extremely difficult for first-timers to get on the ladder. This stymies the whole market, making chains much more difficult to complete. Transactions cannot fully recover until those entering the market for the first time can get the finance to do so. An extension to the stamp duty holiday benefits no-one if the lenders won’t provide the mortgages."
