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20 things
20 things you should know about
24 February 2007
British Bankers Association analysis of MBBG January figures
1 Figures released by the Major British Banking Group (MBBG) revealed that total sterling lending to the UK private sector showed a net underlying increase of £29.1 billion in January.
2 This represented a rise of 1.7 per cent, to £1,290 billion – the strongest monthly rise for nine months.
3 The British Bankers Association (BBA), in its study into the figures, revealed that net mortgage lending rose by an underlying £5.6 billion.
4 Unsecured personal lending was unchanged in January, compared with a rise of £0.1 billion in the recent monthly average statistics.
5 Loans and overdrafts rose by £0.5 billion.
6 Credit card borrowing, however, fell by £0.5 billion, the BBA revealed.
7 Lending increased to real estate companies, rising £0.2 billion.
8 However, the BBA indicated that lending to manufacturers decreased, by £0.3 billion, and wholesale and retail trade, which saw a fall of £0.2 billion.
9 Lending to the construction industry also fell, to £0.1 billion.
10 The study by the BBA indicated that deposits from the private sector rose by £6.1 billion in January, to £937 billion.
11 This represented an increase of 0.7 per cent, the figures revealed.
12 This, however, represents a much lower figure than the average growth of £3 billion, experienced over the previous six months.
13 Of the total rise in lending, mortgage lending accounted for £5,586 million, compared to December’s rise of £5,739 million.
14 Total net lending rise by an underlying £5,561 million in January, compared to £5,889 million in December.
15 The January 2006 results revealed total net lending rose by an underlying £5,733 million.
16 Lending to financial companies rose by £12,854 million in January, with an increase in net lending to other financial intermediaries of £10,324 million, largely reflecting lending to investment companies in the financial sector. Lending increased to real estate companies by £248 million, while lending to manufacturing declined by £301 million, to wholesale and retail trade by £152 mllion, and construction by £133 million.
17 David Dooks, director of statistics at the BBA, said: “We can see that the January sales did not encourage borrowing on credit cards. As in the second half of last year, card borrowing is contracting and, with weaker retail sales being reported, this reflects the consumer’s current attitude to spending and their commitments.
18 He added: “Mortgage lending continued to be buoyant, as we expected following the high volumes of approvals in the Q4 last year.”
19 The MBBG comprise the banking groups of Abbey, Alliance & Leicester, Barclays, Bradford & Bingley, HBOS, HSBC Bank, Lloyds TSB, Northern Rock and The Royal Bank of Scotland.
20 The definitional content of these tables is consistent with the provisional ‘M4’ statistics – covering all monetary financial institutions – released by the Bank of England.
M4’ reflects the non-bank, non-building society part of the UK private sector, including individuals. As the MBBG statistics cover a substantial part of sterling lending by all banks to the private sector, they may provide an indication of the direction of total bank lending.
