Jump to content
House Price Crash Forum
Sign in to follow this  
rantnrave

Savings Rates Climb Again - End of FLS / TFS?

Recommended Posts

Latest top of the charts for Easy Access savings accounts has hit 1.3%. Yes, way behind any measure of inflation (except London property!), but up from 1.00% this time last year. The rate of increase appears to be accelerating.

Effects of FLS and TFS cash running out?

Edited by rantnrave

Share this post


Link to post
Share on other sites

 Authorised and regulated by the Autorité de Contrôle Prudentiel et de Résolution and subject to limited regulation by the Financial Conduct Authority and the Prudential Regulation Authority 


Would you trust French with your money?

Share this post


Link to post
Share on other sites
12 minutes ago, LondonBooming said:

Which bank offers that rate?

Kent Reliance at 1.35  but it is a notice account (but only 60 days) although covered by the UK £85k guarantee, RCI isn't:

"But European banks that run branches here, rather than use a subsidiary, are covered by the pan-European Deposit Guarantee Scheme. It gives €100,000 (around £73,000) of cover, and €200,000 on joint accounts.

They are also under ‘limited regulation’ by our FCA and the Prudential Regulation Authority. Both are signed up to the Financial Ombudsman Service, which you can use if you have an unresolved complaint against them"

Sorry you beat me to it LB re RCI Opened Kent Reliance account yesterday really easy

http://www.kentreliance.co.uk/savings-accounts/60-day-notice-account

Edited by Greg Bowman

Share this post


Link to post
Share on other sites
21 minutes ago, rantnrave said:

Ulster Bank have also dropped the hard credit searches for their 1.25% account

Why would they do a hard credit search for a savings account in the first place? What do they gain from it?

Share this post


Link to post
Share on other sites
4 minutes ago, crashbaby said:

Why would they do a hard credit search for a savings account in the first place? What do they gain from it?

Anti laundering checks, but who will launder money to invest in saving account that pays 1% :)

Share this post


Link to post
Share on other sites
5 hours ago, rantnrave said:

Kent Reliance second in the league tables, with a new easy access account offering 1.27%

Big buy-to-let lender. A subsidiary of OneSavings Bank. As noted on the Buy-to-let Finance Watch thread,  OneSavings was set up by an US private equity firm who are presently selling off their interest in the business. The rate Kent Reliance need to pay for customer deposits is definitely one to watch.

Share this post


Link to post
Share on other sites

RCI Bank are onto a winner, though. They have a useful little box thingy, in which you can enter the amount you want to pay in, and it calculates how much interest you will get.

Seriously, though, this is good news. Only a couple of weeks ago Leeds Building Society dropped their instant access savings rate from 1.0% to 0.6%.

 

Share this post


Link to post
Share on other sites
15 hours ago, Beary McBearface said:

The rate Kent Reliance need to pay for customer deposits is definitely one to watch.

Hi - so your saying could go up because they have to attract deposits ? apologies if I haven't read right

Share this post


Link to post
Share on other sites
20 hours ago, rantnrave said:

Ulster Bank have also dropped the hard credit searches for their 1.25% account

Slight problem is part of RBS if you have any money in any of their brands so guarantee spread

Share this post


Link to post
Share on other sites
28 minutes ago, Greg Bowman said:

Slight problem is part of RBS if you have any money in any of their brands so guarantee spread

That's something that needs checking with any account you open, there are many shared FSCS guarantees.

Share this post


Link to post
Share on other sites
4 hours ago, Greg Bowman said:

Slight problem is part of RBS if you have any money in any of their brands so guarantee spread

Ulster Bank currently has it's own separate FSCS licence

Bank structures http://www.bankofengland.co.uk/pra/Documents/authorisations/fscslists/fscsbankingsaving1709.pdf

BS structures http://www.bankofengland.co.uk/pra/Documents/authorisations/fscslists/fscsbsoc1709.pdf

Above documents as per September 2017 http://www.bankofengland.co.uk/pra/Pages/authorisations/fscs/bankingandsavings.aspx

NB This is NOT a recommendation to use Ulster Bank!

Share this post


Link to post
Share on other sites
Just now, Democorruptcy said:

Ulster Bank currently has it's own separate FSCS licence

Bank structures http://www.bankofengland.co.uk/pra/Documents/authorisations/fscslists/fscsbankingsaving1709.pdf

BS structures http://www.bankofengland.co.uk/pra/Documents/authorisations/fscslists/fscsbsoc1709.pdf

Above documents as per September 2017 http://www.bankofengland.co.uk/pra/Pages/authorisations/fscs/bankingandsavings.aspx

NB This is NOT a recommendation to use Ulster Bank!

Its not advice but Thank you most interesting !

Share this post


Link to post
Share on other sites
8 hours ago, Greg Bowman said:

Hi - so your saying could go up because they have to attract deposits ? apologies if I haven't read right

Yup.

Here's their balance sheet at the last annual report

59dd13f997298_OSBbalancesheet31122016.jpg.83d8ccab35c31d071725abc32e50b1c1.jpg

As you can see the lending is overwhelmingly funded with retail deposits.

Most of those retail deposits are sight or near sight

59dd143404635_Kentrelianceretaildepositors31Dec2016note.jpg.6a60e277d93a64f67c1bf23aa842d4ab.jpg

It's interesting to note how different the structure of this lender is to B&B or Northern Rock who were funded with money from the wholesale markets. It would be interesting to know how easily OSB could replace these retail deposits with wholesale money (and at what cost).

Share this post


Link to post
Share on other sites

Just a thought on OneSavings Bank/Kent Reliance (who I am sure are an excellent bank, well run etc. etc., good with children, loves their mother and so on...)

With the very low interest rates in the retail savings market lots of enterprises that wouldn't otherwise work start to work. A string of crappy buy-to-lets might be making pretty decent money before tax given the prevailing level of rents and the mortgage pay rates. As a consequence there is money to be made lending to the leveraged landlords running these crappy portfolios and this money has been there for the taking for almost ten years. Some lenders have rushed into that space.

At the same time the technological change that was already well-established in 2008 has continued apace. People look at the rates offered by lenders to prospective depositors and then huge amounts of customer deposits can slosh around the system.

The thing that repeats over and over again is that too much credit is extended against real estate then the real estate market falters and the credit is withdrawn causing the real estate market to falter further.

Whilst it may not happen at all and may take a long time to happen if it happens, lenders who have gone into the racier end of the lending market (i.e. lending to portfolio landlords) are potentially a link in this oft repeating chain of events. If it turns out that OneSavings Bank do need to stay at the top of the savings rates tables then should the end of things like the Term Funding Scheme mean that lenders start chasing deposits then saving rates could move up faster than the base rate does. As OneSavings Bank are funded with customer deposits then they'll have to pass their rising borrowing costs onto their debtors (the buy-to-let landlords). If the post-SS13/16 lending space is dominated by lenders like OneSavings then the portfolio landlords could face much higher borrowing costs than they presently anticipate. In this way credit which has been extended cheaply to the portfolio borrowers may in due course be withdrawn. You've be ill-advised to hold your breath but this whole space could look considerably different in two years time if the Bank of England persist with the sequence of measures directing cheap credit away from buy-to-let lending. There's more to the level of mortgage rates than the level of the base rate.

Edited by Beary McBearface

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 297 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.