Summary: The Bank of England released the results from their quarterly Credit Conditions Survey this morning, which showed a marked increase in the availability of secured credit to households. On the other hand, credit availability for both small and large businesses remained at about the same level this quarter.
What does the chart show? The Bank of England asks lenders how the availability of credit provided to various groups has changed over the previous 3 months, and then aggregates the results, weighted by lenders' market shares. The figures used above are the "net percentage balances", which are the difference between the number of lenders saying that credit is more available compared to those saying it is less available, scaled to fit between -100 and +100. The red line shows this number for small businesses, the blue line for large PNFCs, and the green line for secured credit to individuals (mortgages).
Why is the chart interesting? The availability of mortgages shot up in the third quarter of 2012 by the largest amount since records began in 2007, despite fairly pessimistic forecasts earlier in the year. Lenders gave a number of reasons for this in response to the survey, including their market share objectives and their changing attitude to risk. The most significant reason though was the loosening wholesale funding conditions, which they had previously reported to be holding them back from lending more. In the corporate sector, however, tight wholesale funding conditions continue to depress lending to small and large businesses alike.