U.K. Household Demand for Mortgages, Credit Eased in May

(Bloomberg) -- Lending to British households eased slightly in May, according to Bank of England figures published Monday.

Mortgage approvals fell to 65,409, 1% fewer than in April, and unsecured credit grew 822 million pounds ($1.04 billion). That left the annual growth rate of consumer credit at 5.6%, the least for more than five years.

Actual mortgage lending grew 3.1 billion pounds in May, the smallest increase since April 2017.

The figures follow a volatile two months that saw credit demand dip in March amid fears Britain was about to crash out of the European Union, only to recover in April after the Brexit deadline was extended.

The slowdown in consumer-credit growth from 968 million pounds in April was driven by the category that includes personal loans, car finance and overdrafts. Net credit-card lending picked up to 327 million pounds.

Lending to non-financial business rose 1.46 billion pounds in May. Non-resident investors bought 10.4 billion pounds of U.K. government bonds following purchases of 1.2 billion pounds the previous month.

The BOE said household deposits increased by 6.5 billion pounds, the most since September 2016. The jump reflected greater flows into non-interest-bearing deposit accounts.

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