Abbey issues guaranteed income bond with highest ever rate

Abbey Savings has launched its new Guaranteed Income Bond (GIB Issue 25), which offers its highest ever rate of 4.88per cent net (6.10 per cent gross equivalent) per annum.

A single premium life insurance plan, it guarantees a fixed income at a competitive rate and the full return of capital, provided the bond is held for the full four-year term of the investment.

Reza Attar-Zadeh, Head of Savings and Investments at Abbey, said: "The Guaranteed Income Bond has always been a popular product and we are delighted to be able to offer our highest ever rate. We expect this new launch to appeal to people looking for capital security at maturity and the certainty of a regular income for the next four years.”

The GIB guarantees a fixed income of 4.88 per cent net (6.10 per cent gross) if income is taken annually, or 4.80 per cent net (6.00 per centgross) if taken monthly or quarterly.

Income from the GIB is paid net of basic rate income tax, which is not reclaimable by non-taxpayers and starting rate taxpayers. The gross equivalent rate is provided for illustrative purposes only and is never paid by the Guaranteed Income Bond.

With a minimum investment of £5,000, people can invest in the GIB by visiting their local Abbey branch. The closing date for applications is10 July 2007 or earlier if sold out.