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The week in savings - w/e 24th September

 

Monday 20th September

A quiet start to the week was kicked off by UBL with two very competitive rate rises:
5 Year Fixed - up to 1.81% (2nd in the market)
5 Year Fixed ISA - up to 1.51% (best buy)

Cambridge & Counties increased their 95 Day Business Notice to 0.80% (joint 2nd) and 2 Year Business Fixed to 1.50% (best buy)

 

Tuesday 21st September

JP Morgan’s new digital bank, Chase, launched in the UK.  Except it didn’t.  Despite massive fanfare and lots of media coverage, all it actually launched was a waiting list for its app.  Those who registered for the waiting list first thing on Tuesday had to wait more than 48 hours later to get an email with a unique code to enable them to download the app and apply for the account.  Certainly, the most underwhelming bank launch of the year.

Recognise Bank, who became a fully authorised bank last week, launched their first savings accounts:
* 5 Year Fixed - 2% (new best buy)
* 95 Day Notice Account - 1% (5th)

 

Wednesday 22nd September

Wednesday was a good day for easy access savers with two building societies launching very competitive accounts.  First up was Coventry Building Society, who launched a four access saver paying 0.65% - the best paying easy access account in the market (excluding mobile app only providers).  The account allows four free withdrawals per year, after which a charge of 50 days interest will be levied.

Family Building Society joined the fray later in the morning with the launch of a new premium saver account paying 0.65%.  It requires a minimum deposit of £15,000 with additions to the account only permitted up to 5th November.

These moves are very positive for savers and increase the likelihood we will see further increases in rates on the best paying easy access accounts, as other providers respond to these moves.

Atom cut their 1 and 2 Year Fixed to 1.30% and 1.55% respectively. The 1 Year had been best buy at 1.50% and 2 Year at 1.75% was only beaten by Al Rayan Bank.

 

Thursday 23rd September

Two banks improved their rates in the morning of what was an otherwise quiet day in the market:

Oxbury Bank:
* 1 Year - 1.36% (2nd)
* 95 Day Notice - 1.01% (2nd)

Secure Trust Bank:
* 5 Year - 1.85% (3rd)
* 90 Day Notice - 1.05% (best buy)

 

Friday 24th September

Friday is becoming the busiest day in the savings market and this was no exception.

Gatehouse Bank kicked things off with some big increases across their fixed rate pricing:
* 1 Year Fixed - 1.51% (best buy)
* 18 Months Fixed - 1.60% (best buy)
* 2 Year Fixed - 1.75% (2nd)
* 3 Year Fixed - 1.78% (2nd)
* 4 Year Fixed - 1.80% (best buy)
* 5 Year Fixed - 1.86% (joint 2nd)

Paragon also made early changes:
* 1 Year ISA launched at 0.70% (8th)
* 2 Year ISA reduced to 0.91% (8th)
* Limited edition easy access and easy access ISA both withdrawn

Ford Money reintroduced two savings accounts:
* Easy access - 0.50% (joint 9th)
* Easy access ISA - 0.40% (joint 8th)

Aldemore increased some of their fixed rate savings:
* 1 Year Fixed - 1.35% (joint 4th)
* 2 Year Fixed - 1.37% (outside top 10)
* 3 Year Fixed - 1.40% (outside top 10)

Allica improved their savings rates:
* 1 Year - 1.40% (3rd)
* 2 Year - 1.75% (joint 2nd)
* 95 Day Notice - 1.05% (joint 2nd)

Redwood was the final move of the day with changes to their business savings range: 
* 95 Day Notice - increase to 0.90% (best buy)
* 1 Year Fixed - up to 1% (joint 3rd)
* 35 Day Notice - new issue released price at 0.80% (best buy)

 

Summary

The volatile savings market of August has calmed significantly in September with providers making more stable movements.  There was an increase in activity, compared to last week, albeit it would have been difficult to be a quieter week! 

I expected to see movement on easy access rates with at least one provider filling the gap between 0.60% - 0.70%, and we got two.  Coventry have over £38bn of savings balances so can sustain a reasonable period at the top of the market.  This is good news for savers as it means it is much more likely we will see other providers – both those outside the best buys and those paying 0.50% - 0.60% - increase their rates to compete.

Elsewhere, in the key 1 Year Fixed market much will depend how long Allica and Oxbury hold out for.  If other non-Sharia providers move in to the 1.35% – 1.40% range, expect to see pricing nudge upwards again.  However, if they are short-lived, I believe 1 Year rates will slip back into the 1.30% – 1.35%

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