Following last week's release of MBBG net lending figures for July, further information now available on lending to individuals from the British Bankers' Association (BBA), shows that:

Gross mortgage lending totalled £18.1bn in July. This was the highest in the series; £0.1bn higher than in June and 7.0% more than in July 2003. However, after seasonal adjustment, the rise in net lending of £5.4bn (revised) was lower than the average of £5.8bn for the previous six months.

There were 210,500 loans approved in July, with a total value of £16.4bn. Approval numbers were 9.9% weaker than June and 19.5% weaker than July 2003. In particular, the number of loans approved for house purchase was more than 20% lower than both June and July 2003 and they represented a lower proportion (33%) of the total than in June (38%). The average approval for house purchase fell back, to £114,100.

Growth in overall net consumer credit was weaker than in June, rising by £0.7bn (seasonally adjusted). Credit card borrowing was slightly stronger than in June, growing by £0.5bn, whilst demand for personal loans and overdrafts, rose by only £0.2bn, the weakest monthly rise for over a year.

David Dooks, BBA director of statistics, said: "July's rise in net lending was below the recent average, despite the major banks seeing another strong month of gross mortgage lending. Part of this new business represents re-mortgaging activity in the competitive marketplace and it was because of this and a higher level of other redemptions that weaker net lending resulted."

"At this time of the year, when demand is usually strong, loan approvals data, which indicate the short-term path of future lending, were surprisingly weak, with loans for house purchase particularly downbeat."

Overall growth in consumer credit was weaker than of late. Although card borrowing was slightly stronger than in June, it was contrasted by very weak growth in other forms of personal lending.

Mortgage Lending 21% lower in number

July's gross lending of £18,079mn was 0.7% higher than Junes total and compared with £16,903mn in July 2003.

Following June's strong net lending figure of £6,373mn, the seasonally adjusted rise in July was £5,406mn (revised), slightly lower than the average of +£5,769mn over the previous six months.

Compared to the same month a year earlier, July's approvals of house purchase loans were 21% lower by number and 13% by value; remortgaging loans were 15% lower by number and 6% lower by value; and equity withdrawal loans were 23% lower by number and 17% lower by value.

Consumer Credit

New borrowing on credit cards totalled £7,975mn in July. Though weaker than in June, this was still some 2.9% stronger than the average of the previous six months and, although repayments were also higher than average, the seasonally adjusted increase in net lending, of £529mn, was slightly stronger than last month and higher than the recent average.

New lending on personal loans and overdrafts, at £3,081mn, was in line with the average for the previous six months. However, after seasonal adjustment, the rise in net lending was only £219mn, well below the average rise of £556mn over the previous six months.