Most of the rates news in recent weeks has revolved around product withdrawals and lower rates being offered by providers. There have been a few examples of providers going against this trend and in addition, there has been an innovative new account launched by The Family Building Society, which offers savers an alternative to some of the paltry interest rates on offer at the moment, looking suspiciously similar to NS&Is Premium Bonds.
The Family Building Society has launched the Windfall Bond, which in some ways is similar to Premium Bonds from National Savings and Investments, in that holders of the account are entered into a monthly prize draw. The main difference to premium bonds is that the account also pays an interest rate of 0.50%; the rate is guaranteed to match the Bank of England base rate, though this guarantee is reviewed annually. £10,000 must remain in the account at all times and over the course of a year the provider has worked out that you would have a 1 in 64 chance of winning something. The prizes are smaller than Premium bonds, with ten prizes of £1,000, two of £10,000 and one prize of £50,000 given out every month.
Shawbrook Bank has increased the rate on its 2 Year Fixed Rate Bond, the previous Issue 21 paid 2.05%, whereas the new Issue 23 is 2.12%.
It is good to see an increase for a change, albeit one that doesn’t set the world alight. Whilst it is some way behind the market leader (Punjab National Bank, 2.30%), it is certainly the next best that is available to everyone.
Aldermore Bank is increasing the rates on its 1, 2 and 3 year fixed rate accounts on Friday 31st October. The 1 Year Fixed Rate Savings Account will increase from 1.50% to 1.75%, the 2 year is currently 1.85% and will be 2% and the 3 year will increase from 2% to 2.35%.
We also saw the return of a previous best buy as Julian Hodge Bank re-opened its 90 Day Notice Account, but with a reduced rate of 1.55% on £10,000+ (was 1.70%) and 1.65% on balances over £50,000 (was 1.80%). Unfortunately, this reduction has also affected existing account holders. The account now features in our best buy table and customers with £50k+ would get a rate, over and above the top notice account on the table from Shawbrook (1.60%).
Meanwhile many providers are continuing to withdraw some of their top deals, below are a selection of the more interesting ones.
National Counties Building Society re-launched its 53rd Issue Savings Bond, paying 1.90% gross/AER until 29 June 2015.
This bond was originally released on 10th September and it lasted for just two days and this time it didn't last much longer, just three days.
Secure Trust Bank has launched its Fixed Rate Bond 5 Year Term (Series 12) paying 3.11% gross/AER. This replaced the previous version that was paying a competitive rate of 3.22% gross/AER.
Another interesting example of a provider offering a lower rate than before, but still remaining competitive. This indicates that providers do not necessarily have to over-stretch in terms of the interest rate they offer, to bring in sufficient balances.
Manchester Building Society has withdrawn its best buy 45 day notice account, the Platinum Notice Issue 5, paying 1.51% gross/AER.
This withdrawal is the latest piece of bad news for those happy to restrict access to their funds for a better return. The notice account best buy tables are in pretty bad shape, as better paying easy access accounts are available at the moment. Whether this due to a lack of appetite from savers, providers or both, for this type of account remains to be seen.
We are still waiting for providers will bring out better deals soon, so that there is more competition in the market. This may leave individual providers feeling less exposed and allowing the top deals
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