Gross mortgage lending reached £9.7bn for the period, also down from £12.3bn in the corresponding timeframe in 2010. Unsecured personal lending rates were unchanged at £0.7bn.
Total impairment losses stood at £259m compared to £387m in the first half of 2010, but impairment losses on loans and advances increased by £93m as a result of the inclusion of the Perimeter companies’ impairment losses on loans and advances in the first half of 2011.
The bank said the remaining decrease of £221m was largely due to mortgages and unsecured loans, with the lower mortgage charge the result of low interest rates environment, a high quality mortgage book and effective collection handling.
Lending to small and medium-sized enterprises increased during the first half of this year to £9.6bn, up 27% from £8.5bn in the first six months of 2010.
In its results statement, the bank said: "With inflation running above earlier expectations and significantly above the 2% target level, leading to reduced real value of earnings, the economic environment remains challenging.
"Demand for credit has remained subdued. In the housing market, the number of loans approved for house purchase has picked up from its low point in the recession although in the first half of 2011 demand was slightly weaker than a year earlier, while remortgage activity has been stronger."