Banks are expected to increase their lending this year as the UK economy avoids recession
IN BRIEF:
- Total loans in the UK are expected to rise 1.2% this year, a net increase of £29bn
- This has been upgraded from a 0.1% fall forecast in February, according to the EY ITEM Club UK Bank Lending Forecast
- UK GDP is expected to increase by 0.2% in 2023, driving an increase in borrowing
What does this mean?
Anna Anthony, UK financial services managing partner at EY, said the UK is “still on the path to economic recovery” but is “in a more optimistic place than we were a few months ago. The recession that many thought was inevitable is now likely to be avoided and energy prices have fallen, boosting consumer and business sentiment. Despite recent volatility in the global banking sector, the EY ITEM Club has been able to upgrade its growth forecasts for UK bank lending this year, which is positive news.”
