Statistics from the British Bankers’ Association show the amount of house purchase loans approved by banks dropped £3bn, from £10bn in February 2007, to £7bn in February this year.
But the amount of net mortgage lending by banks strengthened in February, the BBA says.
The BBA’s research shows that net mortgage lending by UK banks increased from £5.0bn in January to £5.6bn in February.
The association says the figures reflect a rise in the banks’ market share as a result of recent strong remortgaging.
Credit card lending remained subdued, while personal deposits continued with above-average growth, the figures reveal.
David Dooks, statistics director at the British Bankers’ Association, says: “In an environment of tightening lending criteria, remortgaging either to fix, re-fix, or reduce borrowing costs has been a clear influence on mortgage data in the first two months of this year, resulting in mainstream lenders picking up market share.”
The BBA figures show gross lending was slightly weaker than January but stronger than the recent six-month average.
The BBA says this partly reflects strong remortgaging approvals, which feed through to gross lending much sooner than approvals for house purchase.
Gross mortgage lending by banks was down £200m from £18.1bn in January to £17.9bn in February.
But the amount of mortgage loans approved increased from £19.7bn in January to 18.8bn last month.