Bank lending appeared to slow again in April according to the Central Bank but, if exceptional factors are taken into account, it remains effectively unchanged. Figures released yesterday also showed that the decline in residential mortgage lending, evident since the third quarter of 2000, showed signs of stabilising.

The Bank said the annual rate of private sector credit growth slipped to 11 per cent in April from 12.7 per cent in March. But it was unclear whether this constituted evidence of a slowdown in the economy because the deceleration was largely accounted for by an exceptional item that boosted private-sector lending in April 2001.

This was the restructuring of a credit institution's inter-company funding, which resulted in an increase of almost €1.5 billion in lending that month. Adjusted for this, the annual growth rate would be 12.7 per cent, unchanged from March.

However, the Bank said the underlying trend for credit growth remained downward. The average growth rate for the three months to April was 12.6 per cent, down from 13.4 per cent in the previous three months and 18 per cent in the same three-month period in 2001.

However, there were signs of stabilisation in residential mortgage lending, which rose to 19.2 per cent in April from 18.3 per cent the previous month. This was the highest annual growth rate since August last year.

The figures showed that Special Savings Incentive Account (SSIA) deposits increased by €118 million to €536 million in April, the last month in which individuals could join the scheme.