September mortgage approvals at mutuals up 33%

Savings balances in September grew by £0.6billion, compared to an outflow of the same amount in September last year.

Lending:

* £2.5billion of mortgages approved by mutual lenders in September, up 22% on August 2011 (£2.1billion), and up 33% on September 2010 (£1.9billion).
* 18% rise in mortgage approvals for the first nine months of 2011 at £17.1 billion (£14.5billion, January – September 2010).
* 4% rise in gross mortgage lending in September, up to £2.3billion from £2.2billion in September 2010.
* 14% increase in gross lending for the first nine months of 2011 at £16.7billion (£14.7billion, January – September 2010).

Savings:

* Savings balances were up £0.6billion in September 2011, compared to a decrease of £0.6billion in September 2010;
* Excluding interest credited to accounts, building societies and other mutual deposit takers had net receipts of £0.3billion in September 2011, compared to a net withdrawal of £0.8billion in September 2010;
* In the first nine months of 2011, savings balances held with mutuals have increased by £2.7billion, compared to a decrease in balances of £0.9billion in the same period in 2010.

Adrian Coles, Director-General of the Building Societies Association, said: "Although the UK economic outlook remains challenging, mutual lenders continue to support homebuyers by providing attractive mortgage products.  This has led to a 33% increase in mortgage approvals in September, compared to the same time last year. Mortgage approvals indicate how gross lending will change in coming months. Over the first three quarters of the year gross lending by mutuals was up 14% on the previous year, and the growth in approvals suggests that this trend will continue into the final quarter of 2011.

"Savings balances held with mutual deposit takers have risen by £1.6billion over the third quarter of 2011, in stark contrast to the decrease of £2.3billion for the same period in 2010. Part of the reason for this improvement is likely to be the recent stock market volatility causing investors to seek a more stable home for their money."

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