Happy New Year for building societies’ savers

Strong savings inflows into building societies during the latter part of 2007 have continued, with the new year seeing the largest January inflow (£597 million) to societies since 1997.

Commenting on the figures, Adrian Coles, Director General of the BSA said: “The high savings deposits in January represent another excellent month for building societies. The attractive savings products that societies are offering, coupled with the volatility of share prices, have attracted savers into societies, while the continuing economic uncertainty is encouraging further saving.

“The January figures often show a net outflow as families pay off Christmas bills, with seven of the previous ten years seeing net withdrawals. Placed in this context, the savings inflow in January was particularly high”.

Turning to the mortgage figures, Mr. Coles said: “Gross mortgage lending by building societies in January was around the same level as in January 2007. Although down year on year, net lending was stronger in January than in the second half of 2007, although mortgage approvals have remained relatively subdued. This suggests that we may see a further cooling in mortgage lending as 2008 progresses.”

Building Society Statistics January 2008

Building societies had net receipts of £597 million in January 2008, compared to a net withdrawal of £196 million in January 2007.

Building society net receipts to cash ISAs in January 2008 were £65 million, compared to £83 million in January 2007.

Building society gross lending amounted to £4,097 million in January 2008, compared to £4,036 million in January 2007.

Net lending by building societies was £1,263 million in January 2008, compared to £1,475 million in January 2007.Approvals (loans approved but not yet made) were £3,216 million in January 2008, compared to £4,008 million in January 2007.