Unexpected interest rate reduction

Phil27356

Just received this from the Coventry Building Society:

This email is to let you know that we’re reducing the variable interest rate on this [30 day notice] account with effect from 16 March 2018.
We realise that this isn’t good news for savers. However, as mortgage rates have continued to remain low, we’ve regretfully had to make the difficult decision to reduce the interest rates on some of our savings accounts.
What this means
As at the date of this email, the balance of this account was earning a variable rate of 1.49% gross p.a.** and from 16 March 2018 the new variable interest rate will be 1.34% gross p.a.

Granted that as an relatively easy access account the rate doesn't appear too bad but I thought the current trend was for interest rates to go up! in fact this account saw an interest rate rise in Nov 17.
Anybody out there with this account thinking of moving elsewhere, or already getting anything better (with full protection)?

Thanks

jimjames

Current accounts and reg savers are still way better than that depending on the amount you have

ValiantSon

Others have reported this in another thread. There have actually been a number of accounts with rate reductions in the last few days, not just those with Coventry BS.

For a 30 day notice period it is still a fairly good rate. In fact I am unaware of a better rate elsewhere on that notice period. For comparison, you can get 1.3% in an easy access account with ICICI Bank, or 1.46% on a 90 day notice account with Secure Trust Bank.

Phil27356

Already maxed out on current accounts, thanks.

EachPenny

ValiantSon wrote: »

For a 30 day notice period it is still a fairly good rate. In fact I am unaware of a better rate elsewhere on that notice period. For comparison, you can get 1.3% in an easy access account with ICICI Bank, or 1.46% on a 90 day notice account with Secure Trust Bank.

Phil27356 wrote: »

Already maxed out on current accounts, thanks.

If you don't already have it, then you might want to consider the NatWest Savings Builder - 1.5%* on up to £5000 with instant access.
*(Terms and conditions apply, need to be understood and carefully followed)

Broadwood

Phil27356 wrote: »

Just received this from the Coventry Building Society:

This email is to let you know that we!!!8217;re reducing the variable interest rate on this [30 day notice] account with effect from 16 March 2018.
We realise that this isn!!!8217;t good news for savers. However, as mortgage rates have continued to remain low, we!!!8217;ve regretfully had to make the difficult decision to reduce the interest rates on some of our savings accounts.
What this means
As at the date of this email, the balance of this account was earning a variable rate of 1.49% gross p.a.** and from 16 March 2018 the new variable interest rate will be 1.34% gross p.a.

Thanks

We need a savers union to be able to organise mass ditches and switches.

We've just given 30 day's notice to withdraw ours. Now to find a new home for it.

Savers have been the forgotten losers for far too long now. :mad:

Broadwood

Broadwood wrote: »

We need a savers union to be able to organise mass ditches and switches.

We've just given 30 day's notice to withraw ours. Now to find a new home for it.

Savers have been the forgotten losers for far too long now. :mad:

I'm seriously looking at NS&I 3 year Guaranteed Growth Bonds.

They're paying 2.20 % for the 3 year bond and you can withdraw money if needed but with a 90 day interest penalty. So provided you kept your lump sum in for at least 8 months without any withdrawals you would be no worse off than leaving it in The Coventry at 1.35%. Leave it in NS&I for longer and it would be a gain over staying with The Coventry. That's assuming that rates don't rise again during the next 9 months (allowing 1 month for the notice period for switching - from today).

Anyone better than me with a calc who would like to check my rough figures?
I might have got them wrong.

ValiantSon

Broadwood wrote: »

We need a savers union to be able to organise mass ditches and switches.

We've just given 30 day's notice to withraw ours. Now to find a new home for it.

Savers have been the forgotten losers for far too long now. :mad:

Up to you what you do, but might it not have been more prudent to identify if there was a better option before giving notice?

Broadwood

ValiantSon wrote: »

Up to you what you do, but might it not have been more prudent to identify if there was a better option before giving notice?

No not at all - because the notice is without any commitment. It just gives me a 3 week window from March 28th where I can withdraw money if I have found a better home for it.

ValiantSon

Broadwood wrote: »

No not at all - because the notice is without any commitment. It just gives me a 3 week window from March 28th where I can withdraw money if I have found a better home for it.

Okay. Fair enough. Some people's reaction (and I am not necessarily saying yours) has been to suggest that they would definitely move their money away from Coventry because they are in some way offended.

jimjames

Phil27356 wrote: »

Already maxed out on current accounts, thanks.

In that case it raises the question, do you need so much cash?