Financial measures announced by the government this week to foster increased lending were an essential move in tackling the economic crisis, according to the Council of Mortgage Lenders (CML).

But now, according to CML director general Michael Coogan, the government must seek to increase the range of active lenders to improve funding capacity in the broader market.

He argued that a mortgage market structured by the activity of just a few large financial institutions will not meet consumer demand, nor provide sufficient economic recovery in the long term.

"Further measures targeted at the housing market are likely to be needed to supplement the welcome intervention to address liquidity and capital concerns,"Mr Coogan said.

Gross lending fell 11 per cent in December, down from £14.2 billion to £12.6 billion, but Mr Coogan said the month is traditionally "quiet"for the mortgage market.

Buy-to-let lending has also been affected by the economic crisis - recently reported that 93 per cent of buy-to-let mortgage deals available to private landlords have been withdrawn from the market during the last 18 months.ADNFCR-2002-ID-18985384-ADNFCR

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