Savings remain high

Building societies' excellent performance in the savings market continued in May, with societies attracting savings inflows of £853 million, the highest May figure since 2002, according to the Building Societies Association (BSA).

This is good news for the savers taking advantage of the attractive interest rates and products that building societies are now offering.

Commenting on the figure, Adrian Coles, Director-General of the BSA, commented: "Yet again, savers have responded to the uncertain economic outlook by choosing the safety of a building society over the volatility of the stock market. High interest rates offered by societies, coupled with attractive product ranges, have seen customers continuing to flock to societies with their savings."

Turning to the lending figures, Mr. Coles said: "The lending figures reflect the depressed state of the housing market. With 74% of respondents to the BSA's Property Price Tracker survey expecting property prices to fall over the next year, it is no surprise that demand for new mortgages remains low, with net lending amounting to only £125 million.

"It is important not to read too much into one month's very low figures. However, the figures do reflect the considerable adjustment in housing market activity now being experienced. We expect activity to remain at low levels for some time."

Building Society Statistics May 2008

Building societies had net receipts of £853 million in May 2008 compared with £608 million in May 2007.

Building society net receipts to cash ISAs in May 2008 were £272 million compared with £404 million in May 2007.

Building society gross lending amounted to £3,279 million in May 2008 compared with £4,590 million in May 2007.

Net lending by building societies in May 2008 was £125 million compared to £1,262 million in May 2007.

Approvals in May 2008 were £2,337 million compared with £4,264 million in May 2007.