By Adam Clark 
 

Lloyds Banking Group PLC (LLOY.LN) maintained its dominance in the U.K. mortgage market in 2017 but specialist and smaller lenders grew rapidly, as an uncertain British economy failed to deter competition to provide housing loans.

Lloyds increased its gross lending by 7% to 41 billion pounds ($53.5 billion) in 2017, according to figures from industry body UK Finance. This increased Lloyds' market share of gross lending to 16% from 15.5% in 2016.

The domestic U.K. bank also remained the leading lender by outstanding mortgage balances with GBP290.3 billion, but its market share fell to 21% from 22%.

Behind Lloyds, the next three largest gross lenders--Nationwide Building Society, Royal Bank of Scotland Group PLC (RBS.LN), and the U.K. arm of Banco Santander S.A. (SAN.MC)--all recorded lower volumes than in 2016. Meanwhile, challenger banks and specialist lenders delivered an almost 20% increase in lending activity, said UK Finance.

RBS overtook Barclays PLC (BARC.LN) to become the fourth-largest lender by balances outstanding, having increased its total book size by 7%. Nationwide and Santander remained the second and third-largest lenders by book size, respectively.

UK Finance said that overall it saw more lenders competing for business and gross lending continuing on an upward trend. The organization said the pace of lending in 2018 so far has outpaced its prediction of gross lending of GBP260 billion, representing 2% growth, largely due to stronger-than-expected remortgage activity.

 

Write to Adam Clark at adam.clark@dowjones.com

 

(END) Dow Jones Newswires

July 18, 2018 10:15 ET (14:15 GMT)

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