June’s mortgage figures below trend and consumer credit’s low, says BBA

20 July 2007
Borrowing in the UK fell below the trend in June, with a £11.7 billion rise to a total of £1,331 billion, compared to a £18.9 billion rise in May and an average rise of £12.1 billion over the previous six months, according to BBA (British Bankers Association).

Mortgage lending was down at £5.1 billion in June, from £5.8 billion the previous month and the average monthly rise of £5.3 billion. Meanwhile, unsecured borrowing rose at an unchanged rate, while credit card borrowing fell and secured loans and overdrafts rose by £0.1 billion.

David Dooks, BBA director of statistics, said: “The contrast between May’s strong rise in mortgage lending and a much weaker figure in June makes it difficult to gauge the current impact of higher interest rates on mortgage demand but we’ve seen the trend gradually slowing since the turn of the year.

“Consumers’ appetite for unsecured borrowing on cards, loans and overdrafts remains relatively flat and with personal deposits holding up, household budgets, though clearly tightening, seem to be in good shape.”

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