LONDON, Jan 26 (Reuters) - The number of mortgages approved by British banks hit a nine month high in December and consumer credit continued to expand at a robust pace, industry figures showed on Thursday.
The British Bankers' Association (BBA) said banks approved 43,228 mortgages last month, up from 41,003 in November. Despite a strong end to the year, mortgage approvals for 2016 as a whole stood 4.1 percent lower compared with 2015.
Consumer credit growth picked up to 6.6 percent year-on-year from 6.4 percent in November.
"Overall, we've seen high levels of consumer and business borrowing, although there are early indications that 2017 could sees ofter demand for credit from business and households, as they anticipate future interest rate rises and wait for further clarity on Brexit," Rebecca Harding, BBA chief economist, said.
"Reduced demand for business borrowing may signal plans for investment are being deferred or funded through retained earnings until there is more certainty on the UK's economic prospects after Brexit."
Bank of England Governor Mark Carney said last week he would keep a close eye on consumer spending, given the economy appeared to be increasingly reliant on this to drive growth.
The BBA figures do not include lending by mutually owned building societies, which accounts for around third of mortgages. The next release of the more comprehensive Bank of England lending data is next Tuesday.
