Bank lending steady

British Banker's Association figures (BBA) show UK high street provider's are lending figures remain unchanged since last month.

However the banking sector trade body said the annual growth in the banks' net mortgage lending of 4.3% still substantially exceeds the figure for just 0.9% in April for the mortgage market overall.

Subdued spending has led to consumer credit contracting by 2.5% over the year, it said.

BBA statistics director, David Dooks said:

"High street banks are the main providers in the mortgage market, supplying 75% of all new lending and approving more than 35,000 loans for house purchase each month.

"The low interest rate environment is resulting in customers choosing to reduce or pay off borrowing, particularly personal loans, rather than saving.

"Lending to non-financial companies continues to be slow as demand for loans remains subdued," he added.

According to the figures, the high street banks are currently providing over 70% of approvals for house purchase, compared with around 55% three years ago.

The average value of house purchase approvals, at £150,500, was 10.5% higher than a year ago. Numbers of remortgaging and equity withdrawal approvals continue to be lower than a year earlier.