Aldermore Bank has held its ranking amongst the challenger banks in Q3's £5.8 billion Funding for Lending net lending data.
<
div>Aldermore Bank has held its ranking amongst the challenger banks in Q3’s £5.8 billion Funding for Lending net lending data.
The Bank of England announced that £5.8 billion in net lending is the biggest quarterly net lending flow since the Funding for Lending Scheme (FLS) launched.
Out of the 42 participating groups, three challenger banks have appeared in the top 12 lenders for the latest Bank’s FLS data. Aldermore ranked highest out of the challenger banks, net lending £348 million in the quarter.
|
2013 Q3 FLS NET LENDING |
||
|
1 |
Lloyds Banking Group |
£3,091m |
|
2 |
Nationwide BS |
£2,724m |
|
3 |
Virgin Money |
£870m |
|
4 |
Yorkshire BS |
£758m |
|
5 |
Coventry BS |
£680m |
|
6 |
Tesco Bank |
£456m |
|
7 |
Aldermore Bank |
£348m |
|
8 |
Leeds BS |
£274m |
|
9 |
RBS Group |
£245m |
|
10 |
Skipton BS |
£236m |
|
11 |
Shawbrook Bank |
£155m |
|
12 |
Metro Bank |
£153m |
.jpg)
Rob Lankey, Managing Director of Commercial Mortgages, said: “The Funding for Lending Scheme has been a resounding success, increasing access to financing for homeowners and businesses across the UK. Aldermore has been a keen participant in the scheme and has seen first-hand the impact it has had on lending to consumers and businesses alike.
“As a bank with a particular focus on SMEs, we are delighted that the scheme will be refocusing on business lending in 2014, as many small businesses in particular are still being turned away for finance.
“The refocusing away from mortgage lending is a sign of the recent turnaround in the fortunes of the housing market, and Aldermore will continue to support both aspiring and existing homeowners going forward.”
Despite Shawbrook Bank, which was 11th on the FLS charts, only completing its first FLS drawdown much later than Aldermore Ban, it reached £155 million of net lending in Q3.
.jpg)
Karen Bennett, Sales and Marketing Director of Commercial Mortgages at Shawbrook Bank, said: “Small business finance is a real issue in the UK and any scheme to encourage more lending is welcome. However, looking at today’s figures, it’s clear that the smaller banks are leading the way. Over the last year, lending from the smaller banks has increased by nearly £8.5bn, but lending from the big high street banks has gone down by just under £5 billion. We hope to see this change and the whole industry getting behind small businesses – which is particularly important to help fuel the UK’s economic recovery.“We drew down from the scheme in Q3; this has enabled us to further boost the lending we’re already doing. We recently announced that we had exceeded £1 billion in loans, 75 per cent of which went to small businesses. Our appetite to lend and help more clients to grow their businesses is as strong as ever and we are determined to keep demonstrating this appetite in facts and figures.”
FLS Q3 Data
The Bank’s published data shows the amount borrowed by each group, participating in the FLS, from the Bank and the net quarterly flows of lending to UK households and businesses to the third quarter of 2013.
In the quarter ending 30 September 2013, 21 participants made FLS drawdowns of £5.5 billion. This took the total amount of outstanding drawings to £23.1 billion, with 33 groups now benefitting from funding under the scheme. One additional group joined the scheme in 2013 Q3, taking the total number of participating groups to 42.
Net lending by FLS participants was at £5.82 billion over the quarter.
This compares to lending of +£1.6 billion in Q2, and is the biggest quarterly net lending flow since the FLS was launched reflecting previous improvements in credit conditions beginning to feed through to loan volumes. Cumulative net lending since June 2012 by FLS participants has now become positive at +£3.6 billion, an increase of 0.3 per cent relative to the stock of loans as at June 2012.
Aggregate net lending (i.e. including lending by banks and building societies not participating in the FLS) – based on the M4Lx definition of net lending to households and private non-financial corporations (PNFCs) – was £8.7 billion for Q3 (compared to -£3.6 billion in 2013 Q2). [2] Out of this, £5.1 billion was lending to the household sector, 0.4 per cent of the end-Q2 stock of lending to households. There was £3.6 billion of net lending to PNFCs, 0.9 per cent of the stock, which is encouraging, although taking a longer perspective the growth rate of lending to PNFCs remains muted.
Rates on new household lending have fallen markedly since mid-2012. There have been falls of more than 100 basis points in some representative mortgage rates. Rates on both unsecured and secured loans to households continued to fall or were broadly stable in recent months, and lenders responding to the Credit Conditions Survey expected further compression in most household lending spreads in Q4. Both gross secured lending and repayments have picked up strongly. And the number of approvals for house purchase continued to rise in October, indicating higher mortgage lending in future.
Chart: Changes in quoted mortgage rates and indicative UK bank funding costs since June 2012 (a)
Sources: Bank of England, Bloomberg and Bank calculations.
(a) Change between 30 June 2012 and 31 October 2013;
(b) Two-year 75% loan to value (LTV) mortgages unless otherwise stated;
(c) For fixed-rate mortgages, calculated as the sum of indicative UK bank secondary market bond spreads and the swap rate corresponding to the term of the mortgage. For floating-rate mortgages, three-month Libor is used in place of a swap rate.
Leave a comment