London (MNI) – Mortgage approvals picked up in March but broad
money growth was at its lowest level for a decade, according to Bank of
England data.

M4 rose 0.1% on the month in March to stand up 3.5% on the year,
its lowest yearly rise since February 2000. The weakness of M4 growth,
at a time when the economy is recovering, is striking but the BOE noted
that the M4 data include intra-financial companies transactions, which
can have a substantial impact on the figures.

The BOE’s favoured measures is M4 excluding intermediate other
financial corporations, which aims to strip out the economically
irrelevant intra-financial sector transactions. The M4 ex-IOFC data will
next be published on May 4.

The BOE’s Lending Panel Data, derived from the major banking groups
in the UK, showed mortgage approvals picked up in March, climbing to
52,000 from 48,000 in February.

This was the first monthly rise since November, when approvals hit
their local peak of 62,000 before falling to 58,000 in December, 50,000
in January and 48,000 in February.

The BOE lending panel data account for more than 80% of total UK
mortgage lending, and are a very good indicator of mortgage approval
levels in the BOE’s personal lending series.

In cash terms, net mortgage lending in March fell to stg1.8 billion
from stg2.0 billion in February.

The BOE data showed net lending to UK business remained negative in
February, although it was markedly less negative than in January.

The net monthly flow of lending to UK business in February was
-stg0.8 billion, up from -stg6.9 billion in January. The three month
annualised growth rate in corporate lending flow was -7.9%, down from
-7.1% in January.

–London newsroom: 4420 7634 1624 email:

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