BBA chief economist Richard Woolhouse said: “The banks have been working with the Government to help rebuild Britain’s savings culture. So it’s really encouraging to see evidence of savers taking advantage of the new cash ISA regime in the latest figures.
“Savings were a little low during the first half of 2014, but it seems people were just waiting until the new rules came into effect to invest their money.
“Initiatives like NISA are steps in the right direction but today’s household savings ratio is half that of our parents’ generation. More still needs to be done.”
July saw a strong increase in savers’ cash holdings in high street bank NISAs (the new individual savings accounts with higher investment limits) following the changes announced in the last Budget.
Outside the real estate sector, annual growth in business borrowing continues to improve, with credit expansion now being seen in Manufacturing, Wholesale and Retail sectors.
Mortgage approval processes have now settled after the introduction of the Mortgage Market Review, to a typical level of around 40,000 mortgages approved a month for house purchase, some 12% more than at the same time a year ago.