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October 2011 figures for the main high street banks

"The mortgage market, where the high street banks provide around 70% of new lending, remains subdued and demand for unsecured borrowing is slow, reflecting householders’ caution in the current economic environment.”

“Property-related companies and hotels & restaurants were the last industrial sectors to cut back their borrowing throughout 2009 and 2010 and there may be signs of those sectors emerging first. The level of borrowing by hotels & restaurants is now higher than it was a year ago.”

Duncan Kreeger, chairman of West One Loans, said, “The mortgage market is staggering on, but it is battered and bruised. The protracted eurozone crisis and glacially-slow economic growth has handcuffed the high street banks. They are focusing on shrinking their assets to raise core capital, so appetite for growing their loan books has fallen almost completely off their radar. High loan-to-value mortgages are available, but almost no one can qualify for them. As a result, more borrowers – particularly property investors – are turning to bridging lenders, who have stepped in to fill the space left by the wounded high street banks.  Gross lending in bridging finance has risen 46% since the start of 2010. Annual growth in gross lending of 4% in the mainstream market is insipid by comparison.”

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