Top six lenders dominated mortgage market in 2010

Data just published by the Council of Mortgage Lenders (CML) revealed that the UK’s six largest mortgage lenders accounted for 81.5 per cent of the total volume of mortgage lending last year.

The top six were Lloyds Banking Group (£30billion), Santander (£24.2billion), Barclays (£16.9billion), RBS (£16.2billion), Nationwide (£12.2billion) and HSBC (11.3billion). Only one building society, Nationwide, featured in the top group.

However, the overall share of the mortgage market from the top six was marginally lower than in 2009 when they accounted for 83% share.

In contrast a notable aspect of the 2010 figures is increased lending performance from the mid-sized lenders who almost doubled their lending from £10billion in 2009 to £19.6billion in 2010, and market share from 7% to 14%. This group of lenders includes Northern Rock, Coventry Building Society, Co-op Financial Services, Yorkshire Building Society, Clydesdale and Yorkshire banks, Bank of Ireland, ING Direct, Leeds Building Society and Principality Building Society.

At L&C we placed mortgages with 44 lenders in 2010 and whilst we too saw a high percentage of lending concentrated with the big name lenders, the mid-sized and smaller players were also extremely important in offering attractive mortgage deals for our customers.

Importantly, we’re now seeing the market improve significantly for first time buyers with more deals available at both 90 and 95% LTV and a greater selection of attractive mortgages for buy-to-let borrowers. It is the mid-sized and smaller lenders like Skipton, Leeds, Cambridge, Nottingham, Principality and Coventry that have been particularly active in these areas.

CML predicts that market volume in 2011 will be similar to 2010 and also anticipates that the performance of the mid –sized players will continue to improve. This is good news for borrowers as a greater level of activity from a wide range of lenders will provide more mortgage options which can only be good for the long term recovery of the market.

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