Spain-based personal and business bank account giant Santander has recently slashed the interest rates on its savings offerings by as much as 0.5 per cent on some of its top deals.
Santander has outright binned two of its best buy accounts – a 4 per cent two-year fixed rate bond and a two-year ISA at 3.7 per cent. Both deals, which were near the top of the savings tables, have since been replaced with accounts offering nowhere near such lucrative rates.
The Spanish bank is now only offering a rate of 3.5 per cent on both deals, which are now eclipsed by Cheshire Building Society’s 3.95 per cent two-year fix and its 3.7 per cent ISA. The Bank of Cyprus is tied for the top two-year ISA with an identical offering.
In related news, the Bank of England is not expected to hike the current 0.5 per cent base rate any time in the immediate future. Economists predict an increase of 0.25 percentage points would occur no earlier than July of next year, despite its projected knock-on effect in revitalising UK savings rates.
More than just Santander announced rate cuts in response to the news. Sainsbury’s Bank dismantled several of its more lucrative savers, while Leeds Building Society also announced it would be cutting its 3.70 per cent ISA offer as well.
Leading UK building society Nationwide also slashed its 3.1 per cent e-ISA best buy. The financial service provider is now only offering its tax-free savings product with a 2.75 per cent rate of return.