Savings fall by half in December

Sam Jackson

January 27, 2011

November 13, 2018

Savings fall by half in December

The amount of money saved by Britons in December fell by more than a half from the figure set aside in November, figures have revealed.

A total of £2.3 billion was put away for a rainy day last month, compared to £4.7 billion in November, figures from the British Bankers' Association revealed. The figure was close to the recent half-year average of £2.7 billion.

As potential buyers continued to stay away from the property market new mortgage lending by the major banks fell to an 11-and-a-half-year low.

With repayments and redemptions stripped out, net lending fell to £880 million, the lowest monthly level since June 1999.

Last month there were just 28,726 mortgage deals approved, a level not seen since January 2009, indicating that lending looks set to remain subdued.

Demand for unsecured borrowing remained weak during December, and contracted by 2.2% during the whole of 2010.

Credit card purchases dropped by nearly 6% in the final month of the year, although this is in part likely to reflect weak retail sales due to the bad weather in the run-up to Christmas.

Repayments continued to be higher than new spending, leading to outstanding plastic debt falling by £53 million once interest and charges were factored in.

Lending through loans and overdrafts contracted for the 17th consecutive month, with consumers repaying £322 million more than they borrowed.

David Dooks, BBA director of statistics, said: "The main banks' net lending rose by £20 billion in 2010, in contrast to lending by all other lenders, which decreased by around £12 billion.

"However, mortgage demand was weak throughout the year, with 10% fewer loans approved than in 2009."

Sam Jackson

Money Dashboard

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