charting interest rate rises – 1st Egg, 2nd Abbey

ED · 17 May 2004 at 7:18PM

Abbey have given us a scoop on tiered interest rises for their eSaver account effective 1st June :

4.10% gross for £1+ (4.60% including bonus for 1st 6 months) = up 0.25%
4.20% for £50,000+ = up 0.35%
4.30% for £100,000+ = up 0.45%
4.40% for £200,000+ = up 0.55%

Unfortunately, this retains a half-percent differential between new & existing Abbey customers. Personally, I think it's a mistake not to reward loyalty, especially when offering a new rate for £1 – £50,000 @ 0.20% below the already prevailing rate of similar online a/c's run by 3 other institutions (ie 4.30% via Coventry Bdg Soc, Norwich & Peterborough Bdg Soc, & Halifax plc).

lisyloo – I too hope Halifax will raise rates fairly.

ED · 18 May 2004 at 11:24AM

Top 3 building societies so far announcing rate rises for regular, monthly savings accounts :

up the full 0.25% Leeds & Holbeck @ 5.05% effective May 22nd

up only 0.20% Skipton @ 4.80% on June 1st

up just 0.10% Hanley Economic @ 4.80% on June 1st

Leeds & Holbeck excel again. Presumably it's also a sign they require adequate inward funds to lend other customers for mortgages.

Good thing about Skipton's a/c is that deposits can vary between £25 and £500 month-by-month, whereas most bdg soc's & banks require a set amount that can be changed only on the anniversary or by starting afresh. Skipton also allow over-the-counter deposits, rather than only via Standing Order.

ED · 18 May 2004 at 7:34PM

Nationwide Bdg Soc's online a/c e-Savings offers 4.50% gross on £1+ effective June 1st (up 0.25%). This seems insufficiently competitive, as it is only 0.20% above the current rate (pre-Base Rate rises) offered by Coventry Bdg Soc, Norwich & Peterborough Bdg Soc, Halifax plc.

Anyone here got an active Nationwide e-Savings a/c? Mine has been dormant several years due to frustration at online transfers between Nationwide a/c's not being instant. Actions done on Saturday wouldn't be completed till Monday because Society staff had to check & verify everything. Is this still the case? Or are Nationwide's customer-controlled Internal Transfers now as efficient as Coventry Bdg Soc, First Direct, Abbey, Norwich & Peterborough Bdg Soc, Halifax, et al?

ED · 19 May 2004 at 1:10PM

Egg have dropped their rate to 4.25% (ie nil bonus).

Abbey have enhanced their service : "You can now download your Statement information into personal financial/software packages (e.g. Excel, Microsoft Money, Quicken)"

ED · 19 May 2004 at 7:43PM

4.60% offered by Yorkshire Bdg Soc for online a/c e-Saver (min bal £1,000) starting May 30th.

5.15% for Yorkshire's Monthly Saver from May 30th (to invest £10 - £100 per month).

Northern Rock's online Savings section identifies its Tracker Online a/c as :

"An Internet-operated savings account, with an interest rate guarantee linked to the UK Bank Base Rate"

True enough, the a/c page states :

"The annual interest is guaranteed to be no lower than 0.50% below the UK Bank Base Rate until further notice." (I prefer Stroud & Swindon Bdg Soc's currently fully subscribed recently offered a/c that guarantees a rate not lower than 0.60% above Base Rate until next March…)

Despite the bonus-inclusive 5.01% rate promised for June 1st, the current rate includes a 0.66% bonus for the 1st 6 months.

Personally I won't be applying via :

http://www.northernrock.co.uk/html/savings/trackeronline/trackeronline.asp

Noxid_2 · 20 May 2004 at 1:58PM

Northern Rock's online Savings section identifies its Tracker Online a/c as :

"An Internet-operated savings account, with an interest rate guarantee linked to the UK Bank Base Rate"

True enough, the a/c page states :

"The annual interest is guaranteed to be no lower than 0.50% below the UK Bank Base Rate until further notice." (I prefer Stroud & Swindon Bdg Soc's currently fully subscribed recently offered a/c that guarantees a rate not lower than 0.60% above Base Rate until next March…)

Despite the bonus-inclusive 5.01% rate promised for June 1st, the current rate includes a 0.66% bonus for the 1st 6 months.

Personally I won't be applying via :

http://www.northernrock.co.uk/html/savings/trackeronline/trackeronline.asp

Its a good account now. As I say, I will apply now, throw my limited savings in and if it shows ANY sign of not being the best my money disappears to another account.

MiserlyMartin · 20 May 2004 at 9:24PM

To ED

I have a Nationwide esavings account and flexaccount etc, and all online transfers are now instant. I am also disappointed about the esavings rate always being low (ie ING beats it consistantly) and also them taking a month to move upwards after the base rate change.

Other topics for everyone....Coventrys Netsave used to be very competitive but they did not increase at all after the last increase... they have been at 4.3% since Jan. I don't think they will be moving again this time either because of this wording....

"On and from 01.01.2004 up to and including 30.09.2004, the annual interest rate for NetSave I, II & III will be at least 4.30% AER/Gross p.a., and the monthly interest rate will be at least 4.30% AER, 4.22% gross p.a. In addition the AERs for NetSave Instant, NetSave Instant II and NetSave Instant III are guaranteed to be at least equivalent to the Bank of England Base Rate until 30.09.2004. Up to and including 31.08.2004, if the Bank of England announces an increase in its Base Rate and at that time the AERs equal the guaranteed minimum rate, then the Society will increase the rates payable within one calendar month of that announcement."

Translating: This means they won't increase their rate until the base rate goes above their current AER which is still just above the base rate. I did email them last time saying I was annoyed about there being no increase and said I would not open an account with them because of it. I suggest anyone with a coventry netsave account should close it and get a better deal elsewhere, because they are a classic case of an institution tempting in new business in with a high rate then failing to maintain it >:(

Finally ING.... why are they only moving up 0.2%, I expected the full 0.25% as if rate are still too low as it is!!! >:( Also a factor one needs to take into account when investing in ING is that you lose interest while the money being paid in to ING is clearing so if you are planning on moving large sums frequently in and out of the account a current account and online savings account links together with instant transfers may be better for you.

happy saving

ED · 21 May 2004 at 12:57PM

4.60% gross now paid for online savings a/c of Norwich & Peterborough Bdg Soc (effective from yesterday) for £1 - £20,000. This is a 0.30% rise. Direct link to 'NetMaster Gold Saver II' a/c :

http://www.norwichandpeterborough.co.uk/savings_current/ad_nmg_saver2.htm

Useful instant internal transfers to N&P cheque a/c which pays 2.50% gross if you pay in £500 or more each month.

Instant manual online transfers to N&P regular, monthly savings a/c are allowed. That pays up to 5.15% gross.

MiserlyMartin - let's hope Coventry Bdg Soc imminently increase their NetSave rate by more than the Base Rate rise. I've added my two penniworth by writing to them expressing such expectation. Thanks for confirming Nationwide internal transfers are now instant.

Milarky · 22 May 2004 at 12:55AM

To ED
Finally ING.... why are they only moving up 0.2%, I expected the full 0.25% as if rate are still too low as it is!!! >:( Also a factor one needs to take into account when investing in ING is that you lose interest while the money being paid in to ING is clearing so if you are planning on moving large sums frequently in and out of the account a current account and online savings account links together with instant transfers may be better for you.

happy saving

If you look at ING's rate history, they first came to the market just a year ago offering 4.30% (Base Rate + 0.55%) they then only cut this excellent rate by 0.20% when the Base Rate fell a further 0.25%. Since then there have been 3 base rate rises and ING has increased by 0.20% each time. So they now stand at 'Base Rate+ 0.45%'. ING are claiming that they are out to offer 'long term' competition to other institutions - not merely 'fly-by-nights'.

If they carry on consistently in this way, their rate would remain above the Base Rate until that got to 6.50% - Now, how soon do you expect that be?

On the loss of interest - you don't lose any when paying in, only drawing out. This is generally two working days. I don't know of any accounts these days which don't involve some lost time when transferring (other than internal transfers). You have to time your transactions to avoid including weekends in the two days - e.g don't request money on a Thursday or Friday since it will not arrive before Monday or Tuesday. A nice feature of ING, however, is that you can also specify a future date to start any deposit or withdrawal, so making the timing easier to accomplish.

On Egg - there doesn't seem to be any mention of their 6 month 0.75% annual bonus rate - has it just been withdrawn then?

Noxid_2 · 22 May 2004 at 1:53PM

Yeah Egg has withdrawn there bonus

charting interest rate rises – 1st Egg, 2nd Abbey

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