The figures, published by the Building Societies Association today, reveal the impact of market conditions on mutuals but also show an influx of savings for BSA members.
Savings inflows to building societies last month were a new March record at £1.26bn.
The BSA says this compares with inflows of £0.7bn in March 2007 and represents a 70% year-on-year increase.
The BSA says the March figure is the latest in eight months of outstandingly high savings figures for societies.
But the figures also reveal a drop in lending across mutuals.
Net lending by building societies in March 2008 was £580m compared to £1.791bn in March 2007
Approvals in March 2008 were £3.018bn compared to £5.243bn in March 2007.
But the BSA maintains that with building societies receiving some 70% of funding from the retail market, their continuing strength in attracting savings has meant that problems in the wholesale markets have exerted less of an impact than on competitors.
Adrian Coles, director-general of the BSA, says: “Against the current uncertain economic climate, building societies are seen as tried and tested, traditional and trusted.
“Together with the competitive rates of interest they offer, these attributes mean societies continue to attract record levels of savings.”
He adds: “Building societies have never relied on wholesale funding to the same extent as many other lenders and these substantial saving inflows indicate that building societies are less exposed to the restricted availability of wholesale funds than other lenders.
“Lending at building societies was down year-on-year. This is partly due to building societies withdrawing products and increasing rates on new lending so that they do not become overly competitive.”