Nationwide announces new savings rates

Nationwide Building Society has announces details of its new savings rates, which come into effect on Wednesday 1 April 2009. A new Two Year Tracker ISA is also being launched paying up to 2.50% gross p.a./AER, offering savers a significant premium above the Bank of England Base Rate.

The average interest rate reduction to Nationwide's savings accounts will be 0.25%, significantly less than the 0.50% cut in the Base Rate announced on 5 March 2009. No Nationwide savings account rate is being reduced by more than the reduction in the Base Rate and almost half (46%) of accounts will see no reduction at all.

The introduction of a new Two Year Tracker ISA is good news for savers looking for an account with rate guarantees during the current low interest rate environment. The account is guaranteed to pay 1.50%-2.00% above the Base Rate, depending on the balance. With savers losing up to £100 million in tax this year by not making full use of tax-efficient ISAs, the new Two Year Tracker ISA will provide savers with even more choice.

Nationwide offers a number of savings accounts with rate guarantees that offer long term value to savers:

e-Savings Plus: AER guaranteed to pay at least 0.75% more than the Bank of England Base Rate until 1 January 2010 and at least 0.25% more than the Bank of England Base Rate until 1 January 2011, providing savers make three withdrawals or fewer;

Regular Savings: AER guaranteed to track changes in the Bank of England Base Rate until January 2010;

One Year Tracker Bond (Annual Interest): AER guaranteed to pay between 2.05% and 2.30% (dependent on the account balance) above the Bank of England Base Rate;

Smart (account for under 18s): AER guaranteed to pay at least 0.25% more than the Bank of England Base Rate until 1 January 2010;

Cash Child Trust Fund: AER (including additional bonus) guaranteed to pay at least 1.30% more than the Bank of England Base Rate until 1 January 2010.

Nationwide also offers savers a range of Fixed Rate Bonds and Fixed Rate ISA Bonds. Nationwide's bond range includes:

Five, three, two and one year Fixed Rate Bond, paying up to 4.15%, 3.50%, 3.25% and 3.35% gross p.a. / AER respectively;

Six month Fixed Rate Bond paying up to 3.00% gross p.a. / 3.02% AER;

Five, three, two and one year e-Bond3 paying up to 4.15%, 3.60%, 3.35% and 3.40% gross p.a. / AER respectively;

Six month e-Bond, paying up to 3.10% gross p.a. / 3.12% AER;

One, two, three and four year Fixed Rate ISA Bonds paying up to 3.00%, 3.00%, 3.25% and 2.75% gross p.a. / AER respectively.

Andy McQueen, Nationwide's savings and mortgages director, said: "I'm pleased to announce the launch of our new Two Year Tracker ISA paying up to 2.50%. The Two Year Tracker ISA is guaranteed to track the Bank of England Base Rate and, with the Base Rate being at just 0.50%, the new account represents good value to savers.

"We also continue to provide a range of Fixed Rate Bonds and Fixed Rate ISA Bonds over terms between six months and five years. With so much choice and a fixed rate, savers will benefit from long-term value.

"Like all providers, however, we have had to review our position following the cut in Base Rate and manage our portfolio of accounts in relation to current market conditions. We have tried to protect savers wherever possible, no interest rate will fall by more than the change in Base Rate and the average reduction in rate of 0.25% is significantly lower."