Northern Rock to lower savings rates ?

ashm1

Will Northern Rock likely be lowering their savings' rates this week?

Their rates are higher than NS and I. Commentators are saying Northern Rock will remain public for years.

Has Martin written an article about Saving with Northern Rock ?

bristolleedsfan

Interesting Article Here. :cool:

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article3399820.ece

Beate

The way I have heard it in the news is that Northern Rock will concentrate on the savings market now instead of the mortgage market which should mean they are going to increase savings rates rather than decrease them.

knights

Beate wrote: »

The way I have heard it in the news is that Northern Rock will concentrate on the savings market now instead of the mortgage market which should mean they are going to increase savings rates rather than decrease them.

Don't know that they will get away with that do you?

Surely they will not be allowed to outprice the general market place will they?

Steve_xx

The EEC Commission is set to scrutinise the UK governments aid to NR. I gather that the feeling is that the UK governement may be offering an unfair advantage to NR and if this is so it may well order the UK government to withdraw its 100% guarantee to depositors, among other things.

It is likely that NR mortgages will become more expensive to those that remain with them once their fixed terms end. However, NR is one of only two lenders that will still lend 125% mortgages, albeit at a rate of around 8%.

CannyJock

Steve_xx wrote: »

may well order the UK government to withdraw its 100% guarantee to depositors

The 100% guarantee on first 35K that's being given on all UK banks?

Steve_xx

CannyJock wrote: »

The 100% guarantee on first 35K that's being given on all UK banks?

No, I meant the 100% guarantee to 100% of deposits in NR only.

The 100% guarantee on the first £35k in other banks is not in question.

dougz_2

Steve_xx wrote: »

it may well order the UK government to withdraw its 100% guarantee to depositors

If they withdrew that would it not be a breach of contract with existing savers who had joined after being attracted by that feature?

chesky369

I thought the guarantee only applied to existing savers, not new ones.

merlinthehappypig

chesky369 wrote: »

I thought the guarantee only applied to existing savers, not new ones.

I pressed the wrong button so you got a free 'thanks'!

The 100% guarantee applies to all savers, both old and new and the Govt have said that they will give at least 3 months notice of it's removal.

Steve_xx

dougz wrote: »

If they withdrew that would it not be a breach of contract with existing savers who had joined after being attracted by that feature?

Yes, it may well be, and thereby lies the dilemma for the UK government if the EEC commission should interfere, as no doubt it will!