Seven is the magic number for investors in HSBC’s Guaranteed Capital Account

The latest Bank of England Base Rate increase spells good news for those investors who recently took advantage of HSBC’s Guaranteed Capital Account. With the full 0.25 per cent increase being passed onto the income element of their investment - top end rates now standing at a magic 7.00 per cent Gross (7.23 per cent AER).

And there is even better news for those who missed out on the recent tranche of the account, with the launch of two new issues under exactly the same terms.

HSBC’s Guaranteed Capital Account is available for terms of 3.5 or six years and combines income and growth in one product. It guarantees that the initial capital will remain secure, making it ideal for cautious investors looking for better returns than cash on deposit, but without the risks associated with equity based investments.

Malcolm Prince, head of multi-tie investments at HSBC comments, “We have seen a real appetite this year from investors looking for products that combine income and growth with full capital protection, and the Guaranteed Capital Account suits these needs perfectly.

“Thanks to the full capital protection, investors can reap the rewards of stock market growth knowing their initial capital will always be safe - and thanks to the recent increase in Base Rate, they can enjoy income on their investment at table-topping interest rates.

“We are delighted to be launching a further two issues with exactly the same terms as before, but they are only available for a limited period, so investors need to act fast if they do not want to miss out.”

The Guaranteed Capital Account requires a minimum investment of £3,000 (maximum £999,999), which is split 50/50 to combine income earned from market leading interest rates with the growth potential of a leading stock market index - as detailed below.

Income Fifty

The ‘Income Fifty’ element is designed to generate income on 50 per cent of the initial investment. Investors can choose to receive income each month into a nominated bank account, or rolled up and paid on maturity.

The rate of interest payable will continually exceed Bank of England Base Rate by up to 1.5 per cent for the term of the investment.

Capital Growth Fifty

The ‘Capital Growth Fifty’ element is designed to provide the growth potential of a leading stock market index, without the associated risks, on the remaining 50 per cent of the initial investment. Providing no withdrawals have been made by maturity, the investor will receive back this part of the deposit plus 50 per cent of any growth in the FTSE 100 Index during the term of the investment. If there has been no growth the investor will still receive their deposit in full.

Investors can make withdrawals at anytime subject to a minimum of £250 and maintaining a minimum balance of £1,500. A Market Value Adjustment (MVA) will apply to withdrawals, which may be negative.