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Net lending plummets 40 per cent on last year, says BSA

Net lending was down 40 per cent in April at £666m compared to £1.1bn the same month last year, the latest figures by the Building Societies Association reveal.

Gross lending was down 3.3 per cent in April at £3.65bn compared £3.77bn the previous year.

The value of mortgage approvals in April were £3.18bn compared to £3.75bn in April 2007.

The BSA reported the highest ever monthly inflow to cash ISA accounts resulting in record savings inflows for building societies of £1.8bn.

ISAs saw inflows of £2.1bn in April, which is above total savings inflows as other types of savings accounts will have also seen outflows during the month.

BSA director general Adrian Coles says: “Gross lending was down just 3.3 per cent on the same month last year, and was similar to the level seen in March this year. Although approvals picked up slightly from March, they are still down on last year, and mortgage activity will be subdued in the coming months.

“However, the record savings figures mean that societies, unlike some wholesale funded lenders, have funds available for mortgage lending.

“Despite the depressed mortgage market, building societies remain open for business – every society issued new mortgages during April – and are able to lend.”

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