Adrian Coles, director-general of the Building Societies Association, said: 'We had the reason then, but we are short of a reason this time. We are finding it a bit difficult to explain.'
Part of the explanation is investors withdrawing cash for Christmas spending - there was an outflow of pounds 184m last November. But increasingly the impact of Christmas spending lands in January, as consumers make credit card purchases and delay payment.
Investors are also moving into risk investments such as unit trusts and shares as the rates offered by building societies are reduced. The reduction in base rates in November has triggered a new round of cuts in savers' rates.
Societies are awaiting the new fixed-rate income bond from National Savings promised in the Budget. They fear that if the rate is too high, more cash could drain from societies.
Lending for mortgages was slightly up in November. Net new commitments, an indication about 10 weeks ahead of actual lending, rose from pounds 2.54bn in October to pounds 2.78bn in November.Reuse content