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Remortgaging 'drives up sector's overall performance'

Mortgage approvals increased significantly last month, the British Bankers' Association (BBA) has announced.

The figure rose from December's total of 42,343 to hit 44,288 - hinting at a recovery for the sector from unusually low recent approval rates.

BBA's report also showed an improvement to total net lending, which rose from £4.9 billion to £5.2 billion.

Remortgaging was an especially strong growth area - with many customers shopping around for the best deal after coming off their fixed rate periods.

"Although house prices and new loans for house purchase, appear to be subdued as the housing market slows, the strength of remortgaging would suggest competition for mortgage business and switching remains high," BBA statistics director David Dooks said.

However, less good news from the national retail sector was also contained in the new report.

"Despite strong volumes of retail sales, card transaction volumes were little changed and spending was more than offset by repayments," Mr Dooks added.

"Overall consumer credit remained subdued."

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