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Date issued: 14 Jan 2010
MARKET LEADING THREE YEAR BOND PAYING UP TO 4.70% GROSS P.A./AER* FIXED OFFERED BY NATIONWIDE
Nationwide Building Society today announces details of rate increases for a number of its Fixed Rate Bonds and e-Bonds2, which all offer guaranteed interest rates for savers. This includes the market leading three year Fixed Rate Bond and e-Bond (annual interest options), which pay up to 4.70% gross p.a./AER* fixed for balances over £25,000.
With effect from tomorrow, Friday 15 January 2010, the new rates for annual interest options will include:
- Three year Fixed Rate Bond and e-Bond paying up to 4.70% gross p.a./AER* for balances over £25,000
- Two year Fixed Rate Bond and e-Bond paying up to 4.10% gross p.a./AER* for balances over £25,000
- 18 month Fixed Rate Bond and e-Bond paying up to 3.50% gross p.a./AER* for balances over £10,000
Rates remain unchanged on Nationwide’s five year, one year and six month Fixed Rate Bonds and e-Bonds, four year Stepped Rate Bond, one year Guaranteed Savings Bond3, as well as the Society’s full range of Fixed Rate Individual Savings Account (ISA) Bonds. The variable rate one year Tracker Bond also continues to be available and is guaranteed to beat the Bank of England Base Rate by 2.05% - 2.30%, depending on account balance.
The Guaranteed Savings Bond is only available when a six year Legal & General (L&G) Capital Guaranteed Multi-Index Equity Bond4 (GEB) is purchased together and for at least the same amount. The Guaranteed Savings Bond can only be opened as part of a Guaranteed Combination Plan from a Nationwide branch.
Andy Hutchinson, head of savings at Nationwide, said: “The increase in interest rates on a number of our Fixed Rate Bonds and e-Bonds is great news for those who have made it their New Year resolution to save more in 2010. In particular, our market leading three year bonds1 are an attractive option, though we also offer competitive rates for terms between six months and five years to suit a variety of needs.
“Our most recent research from the Nationwide Savings Index5 shows that a quarter of consumers are not saving any money at all, so hopefully this increase in interest rates will go some way to encouraging consumers to save.”
The current three year, two year and 18 month Fixed Rate Bonds and e-Bonds will be withdrawn at the close of business on Thursday 14 January 2010.
-ends-
Notes to editors
| 1 |
Three year Fixed Rate Bond and e-Bond (annual interest options) paying up to 4.70% gross p.a./AER for balances over £25,000. 4.50% gross p.a./AER payable for balances between £1 and £24,999. |
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2 |
e-Bonds are available online to anyone with, or opening, a Nationwide FlexAccount. |
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3 |
The Guaranteed Savings Bond (GSB) is only available to those who open a new six year Legal & General (L&G) Capital Guaranteed Multi-Index Equity Bond (GEB) at the same time, for at least the same amount via the branch network. The minimum investment is £3,000 in a GEB (£3,600 if a GEB ISA is opened or transferred into the GEB) and a further minimum of £3,000 must be in the GSB. Partial withdrawals from the GSBs during the term are not allowed and there are early access charges to close the accounts. If two GSBs are opened with the minimum of £3,000, then the GEB will need to be opened with £6,000. |
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Issue 13 of the GEB is a six year investment that is designed to provide a minimum return on the investment of 12% gross, plus the potential for growth linked to stock market indices (FTSE 100 Index, DJ EuroSTOXX 50® Index and S&P 500 Index) of up to 50% of the customer’s original investment amount at the end of six years. If the maximum potential growth is achieved, this is equivalent to 6.99% AER**. At the end of six years, if these selected stock market indices do well the customer will receive 100% of the growth in their value, subject to final year averaging. This will be capped at 50% of their original investment. If there is no growth, or the value of the indices has fallen, then they get back their original investment plus 12%. You won’t benefit from any dividend income which you could have if you invested directly, but if you had invested in company shares the return of your original investment would not be guaranteed at maturity. Withdrawals are not available from the deposit plan but if access is required from the ISA a withdrawal adjustment may be applied, and you may get back less than you invested. The value of the GEB may depreciate in real terms due to inflation. In case of death of the investor and encashment of the plan by the beneficiaries, the amount returned may be less then the original investment as a withdrawal adjustment may be applied.
The final calculation of the GEB is based on 100% of any growth in the value of three of the world’s leading stock market indices, subject to final year averaging. The growth of the FTSE 100 Index, DJ EuroSTOXX 50® Index and S&P 500 Index will be measured using the initial level of the Index at close of business on 10 February 2010 and the average level of the Index in the last 12 months of the investment, commencing 10 February 2015 to 10 February 2016 inclusive. This gives the final year averaging level using daily closing stock market values.
The original investment amount must be held to the end of the six year term to benefit from the capital guarantee. If access to funds invested in a GEB ISA is required, customers could get back less than originally invested as a withdrawal adjustment may be applied.
- Issue 13 of the GEB and the GSB is available until 23 January 2010. If the selected GEB closes early, the GSBs will be withdrawn from sale.
- While invested, the GEB investment is held by Nationwide as the deposit taker. The GSB is a Nationwide account. If Nationwide becomes insolvent during this period your original investment amount may be at risk and you may not receive all of your money back.
- If the GEB is withdrawn, or if you cancel your GEB investment, you will not be eligible for the GSBs, which are exclusive to the Guaranteed Combination Plan. The GSB interest rates are subject to change during the offer period and may be withdrawn from sale without notice.
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http://www.nationwide.co.uk/NR/rdonlyres/8853FD1C-2087-48BA-87AE-0D5D9A313661/0/SavingsIndexDec09vF.pdf |
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AER stands for the Annual Equivalent Rate and illustrates what the interest would be if interest was paid and compounded once each year. |
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** |
AER is the Annual Equivalent Rate which illustrates what the maximum potential return would be if paid and compounded each year. This enables customers to compare more easily what potential maximum returns they could expect from their savings over time. |
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The gross rate of interest is the interest rate payable before any income tax is deducted (if customers do pay tax). |
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The net rate of interest is the interest rate payable after any income tax is deducted (if you do pay tax). |
RATES FOR FIXED RATE BONDS, EFFECTIVE FROM 15 JANUARY 2010
| 6 month FRB (annual) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
2.26% |
2.25% |
1.80% |
£10,000 - £24,999 |
2.31% |
2.30% |
1.84% |
£25,000 - £49,999 |
2.41% |
2.40% |
1.92% |
£50,000+ |
2.52% |
2.50% |
2.00% |
6 month FRB (monthly) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
2.22% |
2.20% |
1.76% |
£10,000 - £24,999 |
2.27% |
2.25% |
1.80% |
£25,000 - £49,999 |
2.38% |
2.35% |
1.88% |
£50,000+ |
2.48% |
2.45% |
1.96% |
1 year FRB (annual) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
2.75% |
2.75% |
2.20% |
£10,000+ |
3.00% |
3.00% |
2.40% |
1 year FRB (monthly) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
2.73% |
2.70% |
2.16% |
£10,000+ |
2.99% |
2.95% |
2.36% |
18 month FRB (annual) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
3.25% |
3.25% |
2.60% |
£10,000+ |
3.50% |
3.50% |
2.80% |
18 month FRB (monthly) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
3.25% |
3.20% |
2.56% |
£10,000+ |
3.45% |
3.40% |
2.72% |
2 year FRB (annual) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
3.50% |
3.50% |
2.80% |
£10,000 - £24,999 |
3.75% |
3.75% |
3.00% |
£25,000+ |
4.10% |
4.10% |
3.28% |
2 year FRB (monthly) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
3.45% |
3.40% |
2.72% |
£10,000 - £24,999 |
3.71% |
3.65% |
2.92% |
£25,000+ |
4.07% |
4.00% |
3.20% |
3 year FRB (annual) |
AER |
Gross p.a. |
Net p.a. |
£1 - £24,999 |
4.50% |
4.50% |
3.60% |
£25,000+ |
4.70% |
4.70% |
3.76% |
3 year FRB (monthly) |
AER |
Gross p.a. |
Net p.a. |
£1 - £24,999 |
4.49% |
4.40% |
3.52% |
£25,000+ |
4.70% |
4.60% |
3.68% |
5 year FRB (annual) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
4.75% |
4.75% |
3.80% |
£10,000 - £24,999 |
4.80% |
4.80% |
3.84% |
£25,000 - £49,999 |
4.90% |
4.90% |
3.92% |
£50,000+ |
5.00% |
5.00% |
4.00% |
5 year FRB (monthly) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
4.75% |
4.65% |
3.72% |
£10,000 - £24,999 |
4.80% |
4.70% |
3.76% |
£25,000 - £49,999 |
4.85% |
4.75% |
3.80% |
£50,000+ |
4.96% |
4.85% |
3.88% |
RATES FOR E-BONDS, EFFECTIVE FROM 15 JANUARY 2010
| 6 month e-Bond (annual) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
2.36% |
2.35% |
1.88% |
£10,000 - £24,999 |
2.41% |
2.40% |
1.92% |
£25,000 - £49,999 |
2.52% |
2.50% |
2.00% |
£50,000+ |
2.62% |
2.60% |
2.08% |
6 month e-Bond (monthly) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
2.32% |
2.30% |
1.84% |
£10,000 - £24,999 |
2.38% |
2.35% |
1.88% |
£25,000 - £49,999 |
2.48% |
2.45% |
1.96% |
£50,000+ |
2.58% |
2.55% |
2.04% |
1 year e-Bond (annual) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
2.75% |
2.75% |
2.20% |
£10,000+ |
3.00% |
3.00% |
2.40% |
1 year e-Bond (monthly) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
2.73% |
2.70% |
2.16% |
£10,000+ |
2.99% |
2.95% |
2.36% |
18 month e-Bond (annual) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
3.25% |
3.25% |
2.60% |
£10,000+ |
3.50% |
3.50% |
2.80% |
18 month e-Bond (monthly) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
3.25% |
3.20% |
2.56% |
£10,000+ |
3.45% |
3.40% |
2.72% |
2 year e-Bond (annual) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
3.50% |
3.50% |
2.80% |
£10,000 - £24,999 |
3.75% |
3.75% |
3.00% |
£25,000+ |
4.10% |
4.10% |
3.28% |
2 year e-Bond (monthly) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
3.45% |
3.40% |
2.72% |
£10,000 - £24,999 |
3.71% |
3.65% |
2.92% |
£25,000+ |
4.07% |
4.00% |
3.20% |
3 year e-Bond (annual) |
AER |
Gross p.a. |
Net p.a. |
£1 - £24,999 |
4.50% |
4.50% |
3.60% |
£25,000+ |
4.70% |
4.70% |
3.76% |
3 year e-Bond (monthly) |
AER |
Gross p.a. |
Net p.a. |
£1 - £24,999 |
4.49% |
4.40% |
3.52% |
£25,000+ |
4.70% |
4.60% |
3.68% |
5 year e-Bond (annual) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
4.75% |
4.75% |
3.80% |
£10,000 - £24,999 |
4.80% |
4.80% |
3.84% |
£25,000 - £49,999 |
4.90% |
4.90% |
3.92% |
£50,000+ |
5.00% |
5.00% |
4.00% |
5 year e-Bond (monthly) |
AER |
Gross p.a. |
Net p.a. |
£1 - £9,999 |
4.75% |
4.65% |
3.72% |
£10,000 - £24,999 |
4.80% |
4.70% |
3.76% |
£25,000 - £49,999 |
4.85% |
4.75% |
3.80% |
£50,000+ |
4.96% |
4.85% |
3.88% |
RATES FOR STEPPED RATE BOND, EFFECTIVE FROM 18 DECEMBER 2009
| 4 year Stepped Rate Bond (Annual) |
AER |
Gross p.a. |
Net p.a. |
Year 1 (from opening date to 17 December 2010) |
3.75% |
3.75% |
3.00% |
Year 2 (from 18 December 2010 to 17 December 2011. |
4.25% |
4.25% |
3.40% |
Year 3 (from 18 December 2011 to 17 December 2012) |
4.75% |
4.75% |
3.80% |
Year 4 (from 18 December 2012 until maturity) |
5.25% |
5.25% |
4.20% |
4 year Stepped Rate Bond (Monthly) |
AER |
Gross p.a. |
Net p.a. |
Year 1 (from opening date to 17 December 2010) |
3.71% |
3.65% |
2.92% |
Year 2 (from 18 December 2010 to 17 December 2011. |
4.23% |
4.15% |
3.32% |
Year 3 (from 18 December 2011 to 17 December 2012) |
4.75% |
4.65% |
3.72% |
Year 4 (from 18 December 2012 until maturity) |
5.22% |
5.10% |
4.08% |
FIXED RATES FOR GUARANTEED SAVINGS BOND, EFFECTIVE FROM 30 NOVEMBER 2009
1 year GSB (annual) |
AER |
Gross p.a. |
Net p.a. |
£3,000 - £9,999 |
4.00% |
4.00% |
3.20% |
£10,000 + |
4.25% |
4.25% |
3.40% |
1 year GSB (monthly) |
AER |
Gross p.a. |
Net p.a. |
£3,000 - £9,999 |
3.97% |
3.90% |
3.12% |
£10,000 + |
4.23% |
4.15% |
3.32% |
Applicable for the opening of new bonds
- All bonds may be withdrawn without notice.
- Fixed Rate Bonds and e-Bonds can be opened with a minimum investment of just £1.
- The one year Tracker Bond can be opened with a minimum investment of £100.
The one year Guaranteed Savings Bond can be opened with a minimum investment of £3,000.
The four year Stepped Rate Bond can be opened with a minimum investment of £5,000.
- Members already holding a Nationwide bond can in addition take out any of the new bonds available as there is no limit on the number of bonds a saver can hold, only an upper investment limit of £2,000,000 on Fixed Rate Bonds, Stepped Rate Bonds, Guaranteed Savings Bonds and Tracker Bonds and £3,000,000 on e-Bonds.
- Six month and one year Fixed Rate Bonds or e-Bonds and one year Guaranteed Savings Bond can be closed at any time subject to the loss of 90 days’ interest. The 18 month and two year Fixed Rate Bonds or e-Bonds can be closed subject to the loss of 180 days’ interest. The three year Fixed Rate Bond or e-Bond can be closed subject to the loss of 270 days’ interest. The four year Stepped Rate Bond can be closed subject to the loss of 320 days’ interest. The five year Fixed Rate Bond or e-Bond can be closed subject to the loss of 365 days’ interest.
- No part withdrawals are allowed.
- Members who want a monthly income from their savings can take advantage of the monthly interest option.
- Nationwide e-Bonds are only available online through a FlexAccount and are operated through Nationwide’s Internet Bank.
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