LONDON - The British Bankers' Association said that mortgage lending rose in the month of August, but credit card borrowing continued its downward trend as the UK public sought to rein in spending.
The mortgage lending in August stood at £16.8 billion, up from the £16 billion in July and 1 percent higher than the prevailing figures at the same time last year. Mortgage approvals in August soared by 69,499. This is about 8.5 percent higher as compared with last year's figures and is the first year-on-year increase in the past 15 months. However the seasonally adjusted net mortgage lending rose by £4.3 billion in August up from £3.7 billion in July.
Commenting on these figures, David Dooks, the BBA's director of statistics said, "Whilst August's net mortgage lending remained in line with this year's stable trend, the monthly amount of gross lending exceeded the corresponding month a year earlier for the first time in twelve months." He predicted that the lending would pick up in the coming months, "Stronger remortgaging activity, representing 36% of all approvals, suggests that borrowers are shopping around for better deals and that gross lending will hold up in the coming months."
Consumer borrowing on credit cards increased by 13 percent in August to £8,117 million. But the repayments were higher, bringing the total debt on credit cards to £0.1 billion. The BBA's figures showed that borrowing on loans and overdrafts increased by £0.8 billion in August as compared to £0.3 billion in July. "Structured personal loans and overdrafts were stronger than of late and there may well be some switching between different forms of borrowing. It is worth noting, however, that overall trend growth in consumer credit is less than half the level this time last year," Mr. Dooks opined.
Posted
on : Wed, 28 Sep 2005 09:30 GMT | Mortgages News
By : Salim Patel
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