Mortgage and business lending rises in April

The level of mortgage lending in the UK rose last month in a sign that the passing of the original Brexit deadline in March has eased fears, according to the Bank of England.

Net mortgage borrowing in April was £4.3 billion with the number of mortgage approvals rising from 49,400 in March to 66,300 last month. Over the previous six months, the average was £3.8 billion.

There were also glimmers of improvements in consumer confidence, with the amount borrowed for goods and services rising to £0.9 billion in April, compared with £0.5 billion in March.

Governor of the Bank of England Mark Carney has warned of a “Brexit Fog” hitting the economy

However, the Bank of England pointed out that it was still below the £1.5 billion average seen between January 2016 and June 2018.

Credit card lending fell slightly to £0.2 billion in the period, reversing a boost in March.

Andrew Montlake, director of the UK-wide mortgage broker, Coreco, said that the boost since the passing of the original Brexit deadline could be short-lived.

He explained: “While the passing of the March 29 Brexit deadline will have spurred some into action in April, a broader Brexit apathy is becoming stronger by the day.”

In business lending, the amounts borrowed from UK banks and financial markets increased by £5.7 billion in April, with amount handed out by banks alone rising £4.4 billion.

However, the increase was mainly due to big loans to the manufacturing industry.

Mark Collings, chief commercial officer at debt finance platform CODE Investing, explained: “Despite a continuation of what the Bank’s governor Mark Carney has described as ‘Brexit Fog’, it’s encouraging to see that overall bank lending to business picked up in April.

“The passing of the March 29 Brexit deadline, with all its inherent symbolism, appears to have made some businesses more bullish.

“Drill down into the detail, however, and large manufacturing firms account for most of this increase.”