The British Bankers’ Association (BBA) said today that the number of British mortgage approvals fell in November due to the continuing economic uncertainty across the UK.

The BBA’s monthly report said that UK households were generally more prone to repay existing debts than take on new loans – including mortgages.

In total, some 34,738 mortgages were granted by British lenders in November, compared to 35,196 the previous month. This is still better than in November 2010, however, when mortgage approvals were lower at just 29,875, and the amount paid out in gross mortgage lending still stood at £8.2 billion.

All in all, the annual growth level of mortgage lending among Britain’s banks rose to 1.4 per cent last month compared to the 0.6 per cent figure published by the BBA for October.

UK consumers took the opportunity in November to repay some £7 billion worth of consumer credit, most of it taking the form of credit card repayments. This continues a pattern of consumer behaviour first noted in May. In comparison, just £6.8 million of new credit card debt was taken on by Britons.

Personal savings and deposits also increased in November, rising by £2.1 billion to a total balance of £645.3 billion.

In the BBA statement, the association’s statistics director David Dooks said that “November’s £8 billion of new mortgages, £7 billion of new card credit and £1 billion of new personal loans show that household finance continues to be provided by the banks,” but warned that “until there are clear signs of improvement in the economy and stability on the international front, households and businesses lack the confidence needed to seek credit for spending or investment.”

He added: “Stocks of bank lending therefore continue to be driven down, as repayments dominate over the absence of any material rise in borrowing demand.”

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