Under the Scheme, the Bank of England has provided for a 5% increase in funds for lending – up to £80bn – over the next 18 months.
According to the Council of Mortgage Lenders data, gross mortgage lending over the whole of 2011 was an estimated £139.9bn, topping its forecast of £138bn for the year and up 3% on 2010.
Boulger, senior technical manager at John Charcol said: “Gross mortgage lending will probably be something like £145bn this year. The Funding for Lending Scheme has bought down wholesale rates substantially. You have only got to look at the movement in Libor between January and June – when the Scheme was announced – rates had fallen by 10bps. It’s fallen even further in the period since June.
“It’s clear to me that by far the biggest reason in the fall off in wholesale rates is Funding for Lending. If banks have access to cheap money from the Bank of England, they have less need to go to the market for money.”
“The biggest unknown which could upset the market is the ongoing eurozone problem. The longer the European Central Bank can delay Greece’s exit from the eurozone, the longer banks will have to prepare for the consequences.”
Mortgage Solutions understands Abbey for Intermediaries is one of the major lenders eager to boost lending in the intermediated market in 2013.
Mortgage Solutions understands the lender is also looking to expand its offering and is working to ease some of its criteria and the lending policy changes it introduced at the start of the year.
Speaking at Mortgage Intelligence’s annual conference in Wales last month, Abbey acknowledged it had reined in its share of the market in 2012 after two years of heavy lending.
