26th June 2017

May 2017 figures for the high street banks

The BBA’s latest data from the high street banks* shows that consumer credit growth was 5.1% in May, compared with 6.4% in the previous month.

Gross mortgage borrowing totalled £13.3 billion in May. Net mortgage borrowing was 2.4% higher than a year ago.

Eric Leenders, BBA Managing Director for Retail Banking said:

“This month’s figures show that in the run up to the General Election, credit growth in personal loans, cards and overdrafts has slowed, which was reflected in lower spending; with increased household costs affecting growth in deposits and saving.

Businesses appear to be weighing up their options before raising finance to fund projects or developments.  After a long period of subdued company borrowing, overall growth is starting to stabilise at a modest rate.”


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Household borrowing

Gross mortgage borrowing in May totalled £13.3bn much in line with recent months and 9% higher than a year before.

Net mortgage borrowing in May was 2.4% higher than a year ago.Consumer credit annual growth was 5.1% in May, compared with 6.4% in April. The decline in May was driven by weaker growth in personal loans and overdrafts with annual growth falling from 6.3% to 4.8%, while growth in credit card borrowing also slowed from 6.4% to 5.5% reflecting weaker retail sale volumes in May.


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Mortgage approvals

House purchase approval numbers in May of 40,347 were 3.3% lower than May 2016 and slightly down on the monthly average of 41,923 over the previous six months.

Remortgaging approval numbers of 24,248 were 10% lower than in May 2016 and down on the monthly average of 26,494 over the previous six months.

Other advances approved were 4.8% higher by number than in May last year.


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Borrowing by non-financial companies

Borrowing by non-financial companies was largely flat in May. The annual growth rate of 2.8% in May was similar to that in April but slightly higher than the recent average.

Net capital market issuance in the first five months of 2017 was £5.1bn (net) compared to £12.7bn (net) in the same period of 2016.


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Deposits

The annual growth in personal deposits continued in May the downward path seen since September last year and at 2.6% is the lowest annual growth rate since December 2011.

ISA cash deposits with the high street banks fell by £0.7bn in May compared with a fall £0.6bn in May 2016 and the annual growth rate declined.

Non-financial companies’ deposits are currently growing at an annual rate of 6.1%.