26 Mar

Building societies 'in strong shape'

Building societies 'in strong shape'

Lending remains healthy at building societies despite the credit crunch, the Building Societies Association has said this week.

Such firms are not "struggling" in the mortgage sector, PR and policy manager Neil Johnson said, even if in some cases lending may have been restricted.

And services were limited in some cases because bigger mortgage lenders left the arena, something that meant building societies were inundated and had to maintain "service levels", he observed.

Moreover, Mr Johnson remarked, people should not worry because such institutions are funded in a different way to most banks.

"Building societies are largely funded by retail deposits rather than wholesale markets. So the problems in the wholesale markets haven't affected them in the same way that they've affected banks," he commented.

As more consumers start to save, he added, the stature of building societies is starting to grow.

In March the BBC said that a number of building societies had limited the number of mortgage products they offer.ADNFCR-1222-ID-18523325-ADNFCR

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