THE number of fresh mortgages approved by the major UK banks for house purchase fell in August to the lowest in 19 months, and borrowing by non-financial companies declined, the latest figures have revealed.

The British Bankers’ Association (BBA) figures, published yesterday, showed lending to non-financial companies fell by £104 million during August.

The BBA also noted firms appeared less likely to be using capital markets for raising finance.

Its figures showed net capital market issues by non-financial companies decreased by £1.1 billion last month.

Rebecca Harding, chief economist at the BBA, highlighted her view that “there is still a nervousness about longer-term financial decisions amongst the business sector”.

The BBA figures showed the number of mortgages approved for house purchase fell to 36,997 in August, from 37,672 in July, on a seasonally-adjusted basis. The figure for August was the lowest monthly number of approvals since January 2015.

Ms Harding said: “The high street banking statistics…point to a softer housing market, strong consumer credit and slightly weaker business borrowing in August. The data [were] collected after the Bank of England reduced interest rates to 0.25 per cent, and so give an indication of some of the underlying pressures that the MPC (Monetary Policy Committee) responded to when it made this decision.”

Howard Archer, chief UK economist at consultancy IHS Global Insight, said: “There is concern that businesses will rein back their activities, especially investment, due to heightened uncertainty in the aftermath of the Brexit vote. We suspect that this could become more pronounced in 2017 when the Government triggers Article 50 of the Lisbon Treaty - very possibly in the early months - and negotiations begin in earnest over the UK’s future relationship with the European Union, particularly trade and access to the single market.”