Mortgage lending by mutuals grows by almost a quarter in November

Gross lending by building societies and other mutuals was £2.5 billion in November, up 24% compared to November 2010 (£2.0 billion), and a new high since the BSA started reporting on the current basis in January 2010.

Savings balances held by mutuals increased by £0.5 billion in November, compared to an increase of £0.6 billion in November 2010.

Lending:

24% rise in gross mortgage lending in November, up to £2.5 billion from £2.0 billion in November 2010.

16% increase in gross mortgage lending for the first 11 months of 2011 at £21.5 billion (£18.6 billion, January - November 2010).

£2.1 billion of mortgages were approved in November, up 13% on November 2010 (£1.9 billion).

17% rise in mortgage approvals for the first 11 months of 2011 at £21.3 billion (£18.1 billion, January - November 2010).

Savings:

Savings balances increased by £0.5 billion in November 2011, compared to an increase of £0.6 billion in November 2010.

Excluding interest credited to accounts, mutual deposit takers had net receipts of £0.3 billion in November 2011, compared to a net receipt of £0.4 billion in November 2010.

In the first 11 months of 2011, savings balances held with mutuals have increased by £3.7 billion, compared to a decrease in balances of £1.3 billion in the same period in 2010.

Commenting, Adrian Coles, Director-General of the Building Societies Association, said: "Mutuals have shown their resilience in the face of tough market conditions over the past year and have continued to see their new mortgage lending increase. Mutuals lent 16% more from January to November 2011 compared to the same period in 2010, whilst lending across the mortgage market as a whole has remained broadly flat. The New Year has seen some excellent mortgage products go on sale from mutuals with a return to some offering higher loan to value mortgages. These are encouraging trends against rather discouraging developments in the wider economy.

"2011 has been a difficult year for savers who have faced a substantial squeeze on their incomes from rising living costs, relatively low wage growth and very low interest rates. Yet in recent months mutuals have seen a net inflow into savings accounts as savers look for the security and certainty which equity markets lack. Households may also be delaying big ticket purchases to put money aside for a rainy day."