Guaranteed Savings Tracker Offers Protection From Potential Interest Rate Cuts

Press release published on 16 March 2006 by Scarborough Building Society

Scarborough Building Society’s new Tracker Guarantee Issue Five offers a winning combination of guaranteed interest, penalty-free access and great rates of return.

Replacing the Society’s highly successful Tracker Plus account, which is now sold out, the issue 5 version boasts guaranteed rates as high as 4.80%. Unlike many other similar accounts, this rate also has the potential to go higher, matching any increase if Bank of England Base Rate rises above 4.80%.

And with continued speculation about when the predicted interest rate cut will come, customers will be pleased to know they can open one of the Tracker Guarantee Issue Five accounts with a minimum investment of just £5,000, and can maximise their savings up to a limit of £500,000.

Customers can choose to receive their interest annually, at rates as high as 4.80%, or monthly with returns of as much as 4.65%.

They can also make unlimited withdrawals, so long as these are for at least £1,000 each time, and their account balance does not fall below £5,000.

Interest rates are fixed until 31 March, 2007, after which they will track Bank of England Base Rate, currently 4.5% (or 4.35% for the monthly interest option) until 31 March, 2008. After this rate, the accounts will track at Bank of England Base Rate minus 0.50% (base rate – 0.65% for monthly interest).

Tony Burdin, Head of Retail Strategy, said: ‘At a time when potential interest rate cuts are looming on the horizon, many people are seeking the security of fixed rate savings accounts, so that they know exactly what they are getting for their money, whatever happens.

‘I am pleased to say that the Tracker Guarantee Issue Five account does just that – guaranteeing a market-leading rate of at least 4.80% until 31 March 2007 and an attractive variable rate for the remainder, in addition to penalty-free access to investments.

However, unlike most other similar accounts on the market, the interest rate on our Tracker Guarantee has the potential to go above the fixed rate if the Bank of England Base Rate moves upwards, making this a win win option for potential customers.’

The new Tracker Guarantee Issue Five account is just one of a suite of highly competitive savings accounts offered by the Scarborough, in line with its commitment to offering its customers a long term fair deal.

Other examples are its recently-launched Guaranteed ISA Plus, which offers fixed rates as high as 5.05%, and its ever-popular Easy Saver Direct, which currently offers a variable rate of 4.60%, combined with easy access.

Tony added: ‘As an independent mutual, we have no dividends to pay to shareholders. This means that we can share our success with our customers instead, by returning added value to them in the form of competitive mortgage rates and great interest returns on savings accounts.’

---