KPMG comments on BoE money and credit data - November 2022

Karim Haji, UK head of financial services at KPMG, said

Karim Haji, UK head of financial services at KPMG, said

“The trading updates last week from UK lenders laid bare the impact of the tougher macro environment. Consumers are putting more discretionary spend on credit cards, a leading indicator that customers are running low or have exhausted savings. Meanwhile, as we saw in September, lenders reacted to the market turmoil by repricing mortgage rates or withdrawing products altogether.

“As with the pandemic, banks are having to be proactive in offering help to limit defaults and show they are acting responsibly. Some are offering stepped mortgage rates to avoid homeowners facing precipitous rises as they roll off fixed products and on to variable ones.

“The question is how things play out from here – and there is ample reason to be worried. Consumers are simply pushing their debt further into the future and, with the government support for rising energy bills now set to end in the spring, there looks likely to be a significant reckoning in the first half of next year.”

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KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 15,300 partners and staff.  The UK firm recorded a revenue of £2.43 billion in the year ended 30 September 2021.

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