In 2015, medium-sized lenders saw particularly strong growth, with a 56% increase in annual lending volumes. In 2016, however, these medium-sized lenders saw a gentler rate of growth, and it was the turn of those in the next tier down – those ranked 21-30 by volume of lending – to forge ahead.
These firms saw lending volumes grow by 60% in aggregate and include Paragon, Nottingham BS, Northview Group, Tesco Bank, L&G Home Finance and Fleet Mortgages.
The proportion of new lending by the top 10 firms remained steady at 84% in 2016. Within this, however, there were some sizeable movements: Lloyds Banking Group remained the largest mortgage lender in the UK but continued to shrink its market share, from 17.3% in 2015 to 15.6% last year.
Santander UK also saw a contraction in market share, from 11.8% to 10.4%. Moving in the other direction, The Royal Bank of Scotland grew its share by 1.8% to 12.9%, rising one place in the table to become the third largest lender.
Continuing a trend seen for the last two years, a number of challenger banks and specialist lenders also made headway. Among these, TSB Bank saw the most significant growth, increasing market share by 0.5% and moving up one place in the table to 10th position.
A number of others in this group all saw a significant expansion of activity, most significantly Precise Mortgages with lending growth of 54%, Metro Bank (67%), Fleet Mortgages (150%) and Legal & General Home Finance (200%).
Gross lending overall in 2016 totalled £245 billion, up 11% on 2015, which was a slightly higher rate of market growth than the 9% seen in the preceding year. There was a corresponding increase in marketplace competition, too. Sixty lenders appear in the CML's table for gross lending in 2016 (firms who lent over £50 million), up from 55 in the preceding year.
