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Best-buy savings accounts remain above 6%

27-Nov-2008

Despite the Bank of England base rate being cut by 1.5% to just 3% earlier this month, Investec Private Bank says that best-buy savings accounts are still paying interest rates of over 6%.

The interest rate on the Investec High 5 savings account is unique because it is based on the rates paid by the top five best-buy accounts2. Its current rate of interest is 6.16% gross AER1 – some 3.16% above the Bank of England base rate. Research by Investec Private Bank reveals that the gap between the best-buy savings accounts on 16 January 2008 and the Bank of England base rate was just 0.94%.

Linda McBain, head of Banking, Investec Private Bank said, “Banks and building societies are still keen to attract deposits and are keeping their interest rates high – in many cases above 6%. This explains why the rate on our High 5 Account has only fallen by 0.33% since 5 November this year. Given the commitment of the High 5 account to track the best accounts in the market, our clients can rest assured that they will consistently receive one of the best rates available and therefore don’t need to keep moving their money around.”

The Investec High 5 Account, which requires a minimum investment of £25,000, pays a market leading rate because each week Moneyfacts take the five highest savings rates in the market, finds their mid-point and sets this as the rate for the High 52. This means that savers don't ever need to worry about finding the best rate, and they have the added assurance that the rate is set independently. Unlike other accounts, it does not rely on bonuses to inflate the rate.

1 The Annual Equivalent Rate (AER) is a notional rate, which illustrates the contractual interest rate as if paid and compounded on an annual basis and is subject to variation.

2 The rate is based on the average of the top 5 savings rates published on the Moneyfacts website www.moneyfacts.co.uk across the categories of no notice accounts, notice accounts, internet accounts, monthly interest accounts, accounts for the over 50’s and accounts with an introductory bonus. The rate is correct as at 26 November 2008 and subject to variation.