NatWest 3-year stepped bond

Bogof_Babe

I signed up in Sept for a NatWest 3-year stepped bond, which I was told (and have it confirmed in writing) started on 18th October. They took the money there and then from my savings account and placed it in a holding account, that I can see on my Internet banking, apparently at an interest rate of 0.05%.

As at today it is still there in this holding account. I have looked online and it now appears they are offering the same bond but with a start date of 29th November. I can't get through to my contact on the phone (answerphone), so was wondering whether anyone else signed up for this and knows what's going on. I won't be very pleased if it has been deferred by six weeks, as it is a monthly income bond.

alanq

To open a NatWest bond they make it complicated.

First you need an instant access account other than eSavings or an ISA. You make your deposit into that.

After the funds are cleared the funds should be transferred into the bond BUT until the "start date" (currently 29 November) the bond only pays base rate. (Currently 0.5% not 0.05%)

When I looked at the account last month the start date was 29th November. So either you signed up for an earlier version of the bond and NatWest have failed to make the transfer or you were misinformed about the start date.

I was considering this bond for myself next month (if still on offer) but given all the mistakes and misinformation with the e-Savings account I won't be bothering.

Update:
Issue 224 on offer from 14 August started 18.10.10
Issue 228 on offer from 25 Sept starts 29.11.10
Interest rates are the same for these issues.

Bogof_Babe

Thanks alanq, I couldn't find the details for the previous ones. So it looks like I am right then, and they've c0cked it up. I didn't have a problem with clearing funds as my current account is with them, and they took the money from an instant access NatWest Reward Reserve account.

Better persevere with the phone then. Will report back.

premierfella

The current bonds came on sale 25SEP10. Given this and the OP's letter it does seem that the OP applied for the previous issue, the term of which should have started on 18th.

I don't see any reason why the "holding account" wouldn't have the same account details as the actual bond. The NatWest Monthly Saver technically had different account opening dates and "start of term" dates, but one account number throughout. I don't see any reason why the Fixed Rate Bond would be operated any differently, so I wouldn't be at all surprised Bogof_Babe if when you get hold of NatWest on the phone they tell you that all is well and that the funds in the "holding account" are now earning the Year 1 interest rate.

alanq

Bogof_Babe wrote: »

Thanks alanq, I couldn't find the details for the previous ones.

I got the information from
https://www.emoneyfacts.co.uk/news/savings-news.aspx

premierfella wrote: »

I don't see any reason why the "holding account" wouldn't have the same account details as the actual bond.

The instant access account into which funds must be paid in the first place will have a different number. The bond before "start date" does have the same account number as the bond after "start date"

premierfella

alanq wrote: »

The instant access account into which funds must be paid in the first place will have a different number. The bond before "start date" does have the same account number as the bond after "start date"

Apologies if I am misreading your post but surely this is contradictory? How can it have the same and different account numbers?

Having now looked at the document on the "apply now" link, it seems to me that their are two accounts - one is the savings or current account nominated for receiving the monthly interest (could be an existing account I assume) and the second is the bond itself.

Money in the "bond account" earns variable interest (base rate) until the start date and then the relevant fixed rates once the term starts. I still don't see any reason why NatWest would be operating this account any differently to other banks and having the money in one account from account opening date through to the end of the term of the bond even if the interest rate moves from variable to fixed (and, which I can't find covered in the terms but could *possibly* be the case in practice, the funds can be simply withdrawn from the account before the start of the bond term on instant access terms).

alanq

premierfella wrote: »

Apologies if I am misreading your post but surely this is contradictory? How can it have the same and different account numbers?

Having now looked at the document on the "apply now" link, it seems to me that their are two accounts - one is the savings or current account nominated for receiving the monthly interest (could be an existing account I assume) and the second is the bond itself.

Money in the "bond account" earns variable interest (base rate) until the start date and then the relevant fixed rates once the term starts. Nothing suggests to me that the money is instant access before the start of the bond term?

Yes you have misunderstood.
What you call the "savings or current account" I referred to as the instant access account. As you say the funds in the bond account before "start date" are NOT instant access.

premierfella

alanq,

The reason I misunderstood is because you said "The instant access account into which funds must be paid in the first place..." (my highlighting)

The funds before opening the bond can come from anywhere, not just the nominated account as I understand it. In the OP's case, the savings account the funds came from may not necessarily be the "nominated account" for receiving the monthly interest.

I think we are agreed that the "holding account" is actually the "bond account"?

alanq

premierfella wrote: »

The funds before opening the bond can come from anywhere, not just the nominated account as I understand it.

Not true if the Ts&Cs are to believed. (With NatWest it seems you can never be sure!)

"30.4 You must nominate and maintain for the duration of your bond a NatWest current account or savings account with instant access (other than an ISA) at a branch in the UK. You must tell us that you will be using this account for that purpose. Your initial deposit into your bond must be made by a transfer of cleared funds from your nominated account."

However, I am unclear as to whether a) one can add funds between opening the bond account and "start date", b) one can add funds between opening the bond account and the issue being withdrawn or c) one cannot add funds to the bond account at all. c) seems unlikely otherwise why refer to "initial deposit"?
"30.6 You may not add to your initial deposit during the term of your Fixed Rate Bond."
http://www.natwest.com/content/global_options/terms/Terms_Conditions.pdf

Bogof_Babe

I've just re-checked, and on my online banking the account is referred to as F224, so given the bond is issue 224 it looks as if that is all okay, as per the explanation given by Premierfella - thanks.

It's a bit confusing as the money also appears in the "available" column, but I suppose that's just their lay-out. It has a "paid in" date of 27/9, but the "paid out" column is blank.

Oh well, I'll assume it's okay. I should find out soon as apparently there will be a part-month interest payment at the end of October.

Thanks everyone, I appreciate all your comments and help.

premierfella

Thanks Bogof_Babe and alanq - I had not seem 30.4, which is clearly in line with what you say regarding the initial deposit and that I am wrong in thinking the funds can come from anywhere other than the nominated account.