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Nationwide Building Society to cut savings and banking rates

But no savings account rate would be reduced by more than the base rate

UK-based Nationwide Building Society has announced that it will be reducing the interest rates on a number of its savings and banking accounts by an average of 0.41%, effective February 1, 2009.

Nationwide said that it is committed to supporting savers in this unprecedented low interest rate environment and will not be reducing the interest rate on e-Savings Plus. Nationwide’s new online savings account was launched in December 2008 and is designed for customers who are looking for competitive rates with limited instant access to their funds, added Nationwide.

No savings account rate is being reduced by more than the base rate and several will be reduced by less, including rates on Nationwide’s Regular Savings account reduced by 0.25% and the Monthly Income 60+ account reduced by 0.44%.

A new one-year Tracker Bond issue is also being launched from February 2, 2009, paying between 2.05% and 2.30% above base rate, depending on the account balance.

Nationwide said that it offers a number of savings accounts with rate guarantees that offer long term value to savers, including a new guarantee on the e-Savings Plus, e-Savings Plus with AER for three withdrawals or less guaranteed to pay at least 0.75% more than the Bank of England base rate until January 1, 2010 and at least 0.25% more than the Bank of England base rate until January 1, 2011; Monthly Income 60+ with AER guaranteed to match the Bank of England base rate until January 31, 2011; Smart with AER guaranteed to pay at least 0.25% more than the Bank of England base rate until January 1, 2010; Cash Child Trust Fund with AER guaranteed to pay at least 1.30% more than the Bank of England base rate until January 1, 2010; and Regular Savings with AER guaranteed to track changes in the Bank of England base rate until January 1, 2010.

Matthew Carter, Nationwide’s divisional director of savings, said: Nationwide is committed to providing a range of accounts that meet the needs of savers. We’re pleased to be able to go some way to protecting savers from the most recent cut to the base rate.