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The week in savings - w/e 15th October

 

Monday 11th October

JN Bank kicked the week off with the first pricing changes – improving their 4 and 5 Year Fixed Rates to 1.90% and 1.95% respectively.  This was a surprise move, as they were already a best buy on 4 Year, although the 5 Year increase moved them up from 5th to 2nd

After a prolonged period in our best buys, Atom cut its fixed rate savings range to drop out of the top 10 in all categories.

Allica Bank cut its 1 and 2 Year Fixed Rates, which were the best non-Sharia rates, to 1% and 1.15% respectively.  

QIB, which is only available via the Raisin platform, cut its 1, 2 and 18 Month Fixed rates but launched a new market leading 5 Year Fixed at 2%.  

 

Tuesday 12th October

In an otherwise quiet day, Cynergy Bank improve their easy access ISA rate to 0.65% to move clear as outright best buy

 

Wednesday 13th October

No changes during the day

 

Thursday 14th October

Aldermore cut their 1 Year Fixed from 1.35% (which was joint 4th) to 1% and moved outside the top 10

Allica Bank withdrew their 95 Day Notice Account from sale, which was previuosly paying 1.05% and joint 4th

Family Building Society launched a 90 Day Notice Account paying 1.06% which went straight to the top of our best buys

 

Friday 15th October

Friday is often moving day in the savings market, and this week was no exception, with six providers making changes ahead of the weekend. 

Close Brothers Savings made three changes:
* 1 Year Fixed Rate withdrawn for new customers (was 1.30%)
* 35 Day Notice increased from 0.65% to 0.70%
* 1 Year Fixed ISA launched paying 0.85% (joint 4th)

JN Bank increased their longer term fixed rates again - this time its 3 Year and the second change of the week to its 5 Year:
3 Year - 1.81% (joint best buy)
5 Year - 2% (joint best buy)

Paragon Bank increased their ISA Fixed Rates to move to second or third in each category:
1 Year - 0.86% (joint 2nd)
2 Year - 1.06% (3rd)
3 Year - 1.16% (2nd)
5 Year - 1.31% (3rd)

Recognise Bank cut their 95 Day Notice rate from 1.10%, which was previously the best buy, to 0.95% and dropped to 7th in market

Secure Trust Bank withdrew their 3 Year Fixed Rate from the market, which was paying 1.80% and had sat 3rd in the market

Zopa cut their 1 Year Fixed from 1.36% to 1.30% to drop from 3rd to joint 5th in the 1 Year best buys

 

Summary

It was an interesting week of changes in the market.  Although best buy rates have remained largely unchanged, what is significant is the number of movements behind the leading rates.  In fixed rate bonds, we've seen a collapse in pricing from providers behind the top payers, which are currently the three Sharia banks.  The gap between first and tenth in 1 Year Fixed is now 0.29% and 0.35% in 2 Year, which is incredibly wide.  Further, there's some smaller providers in there, like new entrant Oxbury Bank, who are unlikely to sustain their current price points and I expect to reprice this week.  This could lead to others following suit and a further dip in pricing.  All this suggests to me that we are going to see a short term fall back in 1 and 2 Year Fixed rates.  3, 4 and 5 Year currently have enough competition to hold price points and we may even see a breakout above 2% on 5 Year with three banks vying for top spot.

Elsewhere, easy access pricing looks stable.  Notice pricing has enough competitors in to hold up and Paragon's increases to fixed ISA pricing look likely to provide support to current pricing.  Cynergy's move to the top of easy access ISA - and matching the best rates on offer from ordinary easy access accounts - looks the stand out move of the week and a deal I don't see being beaten.  

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