October sees loans increase

Tue, 28 Nov 2006

Total lending on loans and overdrafts showed a strong increase in October, according to new figures.

Net lending rose for loans and overdrafts by £773 million in the month, statistics from the British Bankers' Association reveal - this compares with September's figure of around £300 million.

Additionally, the six-month average had been £356 million.

The statistics also indicated that lending for loans again outstripped that of credit cards, which fell by £385 million in September.

This drop was again higher than the six-month average contraction for credit card lending, which stands at £0.2 billion.

David Dooks, director of statistics at the British Bankers' association, commented: "October's loan approvals were boosted by remortgaging, as customers look to fix or reduce their mortgage costs, but this activity, with customers changing their lender, has no significant effect on net lending marketwide."

He added that credit card lending had fallen, as repayments are higher than the "relatively lower spending levels" recorded thus far in 2006.

Richard Al-Dabbagh, senior marketing manager for loans at Alliance & Leicester, recently claimed that personal loans can be the most effective way of conducting improvements to add value to a property.


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