Blink and you may have missed it

Rachel Thrussell, Head of Savings at Moneyfacts.co.uk, comments: “Just 14 days after its launch, Coventry BS has announced the withdrawal from sale of its market leading Online Saver account.

“The Online Saver launched on 16 November, was a no notice internet account, paying 6.51% from £1. The rate included a variable AER bonus of at least 0.50% (currently 0.76%) until 31.12.08, with the underlying AER guaranteed to be at least equal to Base Rate until 31.12.09.

“Originally launched with 30 day loss of interest on all withdrawals, this was amended just last Friday to only apply during the initial bonus period; meaning that from 1.1.09 the account became penalty free.

“It’s common for the top fixed rate bonds to come and go very quickly, but is unusual to see a top paying variable account to have such a short shelf life.

“Whilst the rate was market leading, the combination of a bonus, withdrawal restrictions and rate guarantee to navigate may have made the account confusing.

“With rates on no strings instant access accounts paying up to 6.30% and notice accounts as much as 6.50%, savers were only being rewarded by a fractionally higher rate to accept the restrictive terms and conditions.

“Before signing up for any new savings account make sure you are happy with both the rate and the terms and conditions. Getting a great rate but not being able to access your funds as you would like, or seeing your rate drop after an initial period, could make a slightly lower rate with no strings seem much more appealing.”