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Rise in savings deposits at building societies

October 9, 2008 by admin  
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According to a recent report there was a rise in the amount of money deposited into building society savings accounts in the first half of this year. The figures were recently released by the Building Societies’ Association, and indicated that the level of deposits being made into building society savings accounts had risen by almost two thirds in the first six months of this year.

In the first six months of the year building societies saw their savings deposit levels rise to £6.3 billion, and this reflected a rise of 63% rising from incoming deposits of £3.86 billion the first six months of last year. Over recent months many lenders have been offering increasingly attractive interest rates on savings accounts in order to attract a higher level of deposits and decrease their dependence on wholesale finance, which has been difficult and expensive to obtain as a result of the global credit crunch.

A number of banks have also reported a rise in savings deposits, with consumers now being more careful with their money due to the current financial climate.

An official from the Building Societies’ Association stated: “With an uncertain economic outlook and stock market turbulence, savers are wisely viewing building societies as excellent homes for their money.”

The news is not all good, however, as the Building Societies’ Association has also reported a 60% slump in lending, as a result of its members tightening lending criteria and conducting less business in response to the global credit crunch.

BSA Director General Adrian Coles stated: “Many societies have chosen to follow a conservative lending policy to ensure that they maintain the high quality of their loan books.”

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