–UK BBA: Feb Mortgage Approvals stg4.935bn vs stg5.040bn Jan
–UK BBA: Feb Approvals for Remortgaging 21,101 vs 20,571 in Jan
–BBA: UK Feb Net Mortgage Loans stg2.825bn vs stg2.566bn in Jan
–Adding Commentary on Consumer Credit, Business Lending

LONDON (MNI) – Mortgage approvals continued to languish in February
at around 35,276 compared with the 35,154 seen in January, according to
the latest British Bankers’ Association data.

In value terms, mortgage approvals were running at stg4.935bn in
February compared with the stg5.40bn in January while approvals for
remortgaging were also lackluster at 21,101 in January compared with the
20,571 seen in January.

The subdued mortgage market at the turn of the year had been blamed
by analysts on the phasing out of stamp duty relief for houses at the
lower end of the price scale. The colder weather had also been seen as a
factor in keeping buyers out of the market.

BBA Statistics Director David Dooks said that consumers continued
to suffer a lack of confidence:

“High street banks continue to provide the majority of all new
lending for mortgages, though the volume of approvals remains subdued
after the year-end stamp-duty change. Consumers are focusing on
building up their deposits, while any increase in borrowing appetite is
unlikely without greater household confidence and economic certainty.”

The BBA noted that credit card gross lending in February was 1.5%
lower than a year ago compared with -8.2% in January. This increase is
also reflected in numbers of transactions which were 4.9% higher than in
February 2009 compa red with -2.9% in January. The BBA said that this
reflected anecdotes of increased footfall in February as the weather
improved.

New personal loans increased slightly in February possibly as the
car scrappage scheme was extended by a further month but the BBA
noted that gross lending was largely matched by higher repayments.

The BBA stressed that the major high street banks are continuing to
do their bit in terms of providing small businesses with access to
funds. The organisation blamed weak business demand for loans as the
key reason for the weak business loan numbers:

“Larger companies have accessed capital markets recently for
alternative funding and with company demand elsewhere being generally
muted, weaker business lending by banks is the outcome. Availability of
lending for SMEs, however, is reflected in a continued high approval
rate for loan applications”.

–London Bureau; Tel: +442076341624; email: dthomas@marketnews.com

[TOPICS: MABDS$,M$B$$$,MT$$$$]