Lending by banks up 33% over last year

Christina Hoghton
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Christina Hoghton

A slight lending dip between January and February doesn’t dampen the huge increase in lending by banks over the last 12 months

Mortgage lending by banks rose by a significant 33% between Feburary 2015 and last month, marking the second highest increase since 2008, according to the British Bankers’ Association.

It noted that lending dipped slightly between January and February this year to reach £13.3bn last month, but this seasonal fall is outweighed by the large annual increase.

The number of mortgage approvals in February was 26% higher than a year ago, with remortgaging up 31% and house purchase up 20%.

Plus the trade association said that unsecured borrowing by households is growing at around 6% a year reflecting low interest rates and relatively strong household finances.

Richard Woolhouse, chief economist at the BBA, said: “Mortgage borrowing remained buoyant in February. It appears that borrowers are continuing to try to get ahead of the increases in stamp duty for buy-to-let and second home buyers scheduled to come into effect next month.

“Consumer confidence is also robust. Households are increasingly taking advantage of low interest rates by taking on more unsecured borrowing.”