Northern Rock 1 & 2 year bonds - paying 3.75% & 4.15 respectively

Steve_xx

There are two new bonds available from Northern Rock:

FIXED RATE BOND Issue 370: a fixed term account maturing on 1.9.10 with a minimum investment of £1 paying 3.75% yearly (3.45% monthly). No earlier access. Further additions whilst issue remains open.

Link: http://www.northernrock.co.uk/savings/fixed-rate-bonds/fixed-rate-bond_issue_370/

FIXED RATE BOND Issue 371: a fixed term account maturing on 1.9.11 with a minimum investment of £1 paying 4.15% yearly (3.85% monthly). Earlier access on 90 day loss of interest. Further additions whilst issue remains open.

Link: http://www.northernrock.co.uk/savings/fixed-rate-bonds/fixed-rate-bond_issue_371/

Note: The two year offering might suit those who think they may need earlier access, although there would be a 90 day loss of interest. It is not specified whether the loss of interest would be on the amount withdrawn or on the whole.

savetilibleed

Something I've noticed with Northern Rock is their fixed rate bonds always pay much less for the monthly option compared with the same annual rate elsewhere.

The NR Issue 370 you mention is 3.75% annual gross and 3.45% monthly gross.

Compared that with, say, Cheshire BS one year bond at the same 3.75% annual gross rate, their monthly rate is 3.69%

Same is true of NR 3 year stepped bond, which in year 3 is 5% annual and 4.70% monthly. Compare then to Coventry BS 3 year stepped bond, in year 3, also 5% annual, is 4.89% monthly.