Money and Credit - September 2018

These monthly statistics on borrowing and deposits by households and businesses are used by the Bank’s policy committees to understand economic trends and developments in the banking system.
Published on 29 October 2018

Key points

  • Consumer credit increased by £0.8bn in September. This was less than in August, as new borrowing for car finance fell sharply.
  • The flow of mortgage lending increased to £3.9 billion in September, following two relatively weak months.
  • Net finance raised by private non-financial corporations (PNFCs) was negative in September. Within this, negative movements in bank lending, and equity and commercial paper issuance were partially offset by net positive bond issuance.

References in the text point to the summary tables below. For further statistics, please see our Bankstats tables.

Lending to individuals (Tables A-E)

Consumer credit (Tables B and C)

The net amount of new consumer borrowing, excluding mortgages, fell to £0.8 billion in September, down from £1.2 billion in August (Chart 1). The fall on the month was due to weaker net borrowing for other loans and advances, which fell from £0.7 billion to £0.3 billion. Within this, new borrowing for car finance fell sharply, consistent with very weak car registration numbers in September,1 while other borrowing, such as personal loans and overdrafts, was robust. Net credit card borrowing was £0.5 billion in September, unchanged on the month and broadly in line with the average of the previous 6 months.

The annual growth rate of consumer credit slowed further in September, to 7.7%, reflecting these weaker monthly lending flows. The annual growth rate was the lowest since June 2015, and well below the peak of 10.9% in November 2016.

Chart 1: Consumer credit flows

Seasonally adjusted

Chart 1: Consumer credit flows

Mortgage lending (Tables D and E):

Households borrowed an extra £3.9 billion secured against their homes in September, following slightly weaker flows in July and August of £3.3 billion and £3.1 billion, respectively. The annual growth rate of mortgage lending was unchanged at 3.2% in September. It has now been around 3% since late 2016, and remains modest compared to the pre-crisis period.

The number of mortgages approved for house purchase was broadly unchanged at 65,000 in September (Chart 2). This gives us an indication of the potential trend in new mortgage lending in coming months. The number of approvals for remortgaging remains close to its recent peak, although it fell back on the month to 49,000.

Chart 2: Mortgage approvals

Seasonally adjusted

Chart 2: Mortgage approvals

Lending to businesses (Tables F-I)

Businesses can raise money by borrowing from banks or from financial markets (in the form of bonds, equity and commercial paper). The total amount outstanding of businesses’ borrowing from these sources fell by £0.8 billion in September (Chart 3). Within this, businesses made net repayments to banks for the first time since November 2017. There were also net redemptions of funds raised through equity and commercial paper - new issuance was offset by larger repayments. The net redemption of equity was £0.5 billion and the net redemption of commercial paper was £1.5 billion. Bond issuance, however, was positive in September at £2.8 billion.

Chart 3: Net finance raised by PNFCs2

Seasonally adjusted

Chart 3: Net finance raised by PNFCs

Within bank lending to businesses, the industrial breakdown shows that lending for real estate activities was particularly strong in 2018 Q3. In contrast, lending for construction activity was negative in September for the seventh consecutive month.

The fall in bank lending to businesses was driven by lending to large businesses, which fell £2.0 billion in September following three months of positive flows. Bank lending to small and medium sized businesses (SMEs) increased by £0.4 billion in September. These flows left the annual growth rate of lending to large businesses unchanged at 2.2%, while the growth rate for SMEs remained close to zero for the ninth consecutive month.

Broad money (Table J)

The total amount of money held by UK households, PNFCs and non-intermediary other financial corporations (NIOFCs) (Broad money or M4ex) was unchanged in September. This was below the £3.7 billion average increase per month over the previous six months. Within this, there was an increase in money held by households of £2.5 billion, which is below the average of the past six months. Money held by PNFCs fell £0.9 billion, and money held by NIOFCs fell £1.6 billion.


  1. Download ZIP file: New car registrations - September 2018
  2. Please note, there may be sizeable discrepancies between the total net finance raised and its components due to the aggregate being seasonally adjusted separately to the components

Excel Summary tables

PDF Highs and lows

Next release date: 29 November 2018