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Gross lending at mutuals up 28% year on year

Gross mortgage lending by building societies and other mutuals rose 28% year on year in February 2012, Building Societies Association data shows.

Gross lending stood at just over £1.9bn in February compared to just under £1.5bn in the same period last year and slightly less than £1.9bn in January.

New mortgage approvals were also up 31% on February 2011 and 29% on January 2012.

On the other side of the balance sheet mutuals experienced a retail savings outflow of £87m in the month compared to an inflow of £359, in February 2011.

It is an improvement on January where the outflow was £1.1bn.

Adrian Coles, director-general of the BSA, says societies approvals grew despite an overall flat market.

He says: “The strong financial results released by a number of mutual lenders in recent months show that the sector is well positioned to offer market leading products to its customers and are open for business. “

“Household finances remain under pressure. Rising unemployment, declining real incomes and a lower-for-longer base rate environment combine to make it difficult and less attractive for savers to increase their deposits in savings accounts. It is therefore unsurprising that savings balances fell slightly in February.”

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