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Press release
NATIONAL SAVINGS AND INVESTMENTS RATES CHANGES
21 April 2004
National Savings and Investments (NS&I) is changing interest rates on its fixed rate products following movements in market rates for Government Bonds (gilts) since the last interest rate changes were announced in February 2004.
Fixed Rate Products
New issues of Fixed Interest Savings Certificates, Children's Bonus Bonds, Pensioners Guaranteed Income Bonds, Fixed Rated Savings Bonds and Capital Bonds will offer interest rates up to 0.15% higher and will be available from 22 April 2004.
Falls in the market rates for index-linked gilts since February 2004 mean that the rate on Index-linked Savings Certificates will decrease by between 0.5% and 0.10%.
The investment limit on both Fixed Interest Savings Certificates and Index-linked Savings Certificates will rise from £10,000 per issue to £15,000 per issue on 29 April 2004.
NS&I's interest rates: key facts
- NS&I does not price discriminate between different channels - the return on products is the same no matter where, when or how they were bought. NS&I's sales channels include telephone, online, by post or at any of the UK's 15,000 Post Office™ branches
- NS&I's accessibility is not limited by geography or location, as the same rates are available throughout the UK
- NS&I's fixed rate products are on sale everyday throughout the year - many providers offer fixed rate products for limited periods during the year
- NS&I prices its products to give fair, consistent and value for money returns. NS&I does not try to buy market share, saving the need for customers to spend time shopping around for short-term headline rates
Gill Cattanach, National Savings and Investments marketing director, said, "We always aim to provide consistent and fair rates and, as gilt yields have increased recently, we are now in a position to increase the interest rates offered on most of our fixed rate products."
ENDS
NOTES TO EDITORS
New Tax-free Rates*
(Fixed Products)
| |
Rate pa/ AER**** (change in brackets) |
Equivalent grossed up rate for basic rate taxpayers** |
Equivalent grossed up rate for higher rate taxpayers** |
2-year Fixed Interest Savings Certificates
25th Issue
Guaranteed compound rate over 2 years |
3.05% (+0.10) |
3.81% |
5.08% |
5-year Fixed Interest Savings Certificates
75th Issue
Guaranteed compound rate over 5 years |
3.25% (+0.05%) |
4.06% |
5.42% |
3-year Index-linked Savings Certificates
6th Issue
Guaranteed compound rate over 3 years |
Index-linking + 0.85% (-0.10%) |
Index-linking + 1.06% |
Index-linking + 1.42% |
5-year Index-linked Savings Certificates
33rd Issue
Guaranteed compound rate over 5 years |
Index-linking + 1.05% (-0.05%) |
Index-linking + 1.31% |
Index-linking + 1.75% |
Children's Bonus Bonds
13th issue
Guaranteed compound rate over 5 years, including fifth anniversary bonus |
4.25% (+0.10%) |
n/a |
n/a |
Fixed Rate continued
| Gross Rates*** | Rate pa (change in brackets) | AER**** |
1-year Pensioners Guaranteed Income Bonds
Series 23 | 4.0% (+0.15%) | 4.07% |
2-year Pensioners Guaranteed Income Bonds
Series 29 | 4.2% (+0.15%) | 4.28% |
5-year Pensioners Guaranteed Income Bonds
Series 38 | 4.45% (+0.10%) | 4.54% |
1-year Fixed Rate Savings Bonds
Issue 25 |
£50,000+
£20,000+
£500+ |
| |
monthly interest option |
£50,000+
£20,000+
£500+ |
|
4.1% (+0.15%)
3.9% (+0.15%)
3.75% (+0.15%)
4.0% (+0.15%)
3.8% (+0.15%)
3.65% (+0.15%) |
4.07%
3.87%
3.71% |
3-year Fixed Rate Savings Bond
Issue 19 |
£50,000+
£20,000+
£500+ |
| |
monthly interest option |
£50,000+
£20,000+
£500+ |
|
4.5% (+0.15%)
4.3% (+0.15%)
4.15% (+0.15%)
4.4% (+0.15%)
4.2% (+0.15%)
4.05% (+0.15%) |
4.49%
4.28%
4.13% |
5-year Fixed Rate Savings Bond
Issue 17 |
£50,000+
£20,000+
£500+ |
| |
monthly interest option
| £50,000+
£20,000+
£500+ |
|
4.6% (+0.10%)
4.4% (+0.10%)
4.25% (+0.10%)
4.5% (+0.10%)
4.3% (+0.10%)
4.15% (+0.10%) |
4.59%
4.39%
4.23% |
Capital Bonds
Issue 17 |
4.55% (+0.10%) |
4.55% |
* Tax-free means the return is exempt from UK Income Tax at all rates of taxation.
** At current tax rates.
*** Gross means the taxable rate of interest without the deduction of UK Income Tax.
**** AER stands for Annual Equivalent Rate and enables the comparison of interest rates from different financial institutions and across different products on a like-for-like basis. It shows what the notional annual rate would be if interest was compounded each time it was credited or paid out. Where interest is credited once a year the rate quoted and the AER will be the same.
2. NS&I is the exclusive sponsor of The Classical BRIT Awards, the UK's premier classical awards show, at the Royal Albert Hall on 26 May 2004.
3. For further information, or to arrange an interview, contact the media relations team.
Media team
NS&I has a number of spokespeople available for interviews and our experienced radio team is available via our ISDN line: 020 7602 4522.
The numbers below are for media use only.
Customers
wishing to contact NS&I can find details here.
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