Mortgage approvals highest since 2007

Approvals climbed from 72,798 to 76,947 in January, yet they still sit 25% below pre-crisis levels.

Net lending to households and businesses participating in the Funding for Lending scheme reached £5.8bn in the fourth quarter.

The number of groups taking part in the scheme rose by four to 46 over the period, while outstanding aggregate drawings in the first part of the scheme was £41.9bn.

Paul Fisher, executive director for markets at the Bank of England, said: “The UK recovery has gained momentum, with easier credit conditions playing an important role. Since the FLS was launched in mid-2012, FLS participants’ net lending to households and businesses has been around £10bn.

“In 2014 the FLS will continue to support lending to businesses, where it is most needed. The firm-by-firm sectoral lending data - published for the first time today - show that a number of participants, including some smaller, challenger banks, have successfully used the FLS to expand their SME lending.”

Cumulative net lending by FLS participants was £10.3bn over 18 months from the third quarter of 2012 to the fourth quarter of 2013.

Lending to non-financial businesses dipped £0.6bn in January, and 3.9% year-on-year, while small firms reduced their borrowing by £300m.

Prior to FLS being announced lending was widely expected to decline rather than increase over the next 18 months.