A UK bank has boosted the return on one of its long-term savings accounts, offering a market-leading rate at a time when providers are preparing for cuts across the sector. Hampshire Trust Bank has increased the interest on its five-year fixed saver to 4.31% AER, a move described as “excellent” by analysts at Moneyfactscompare.co.uk.
The account is part of Moneyfacts Pick of the Week, which highlights the strongest new products and rate rises. With inflation easing and a base rate cut expected, experts say deals like this may not stay around for long. Adam French, head of news at Moneyfactscompare.co.uk, said the bank’s updated rate puts it ahead of similar five-year bonds currently available.
He explained: “Hampshire Trust Bank has increased the rate on its 5 Year Online Fixed Saver, now paying a market-leading 4.31% AER compared to other fixed bonds with similar terms currently available.”
He said the product could appeal to savers wanting certainty over returns.
Mr French added: “Recent Moneyfacts analysis found that the average Stocks & Shares ISA has delivered an annual average return of 6.79% over the last 15 years but returns can be volatile year-on-year.
“This account is a good option for anyone looking to lock their money away for a few years and benefit from risk-free guaranteed returns.”
Customers can open the account with just £1, up to a maximum of £250,000. Additions are allowed for 14 days from opening, but no withdrawals are permitted during the five-year term.
Hampshire Trust Bank also allows savers to manage the account online or by phone, and interest is paid annually on the anniversary of opening.
Moneyfactscompare.co.uk also highlighted several other strong savings deals available this week.
Union Bank of India (UK) – 1 Year Fixed Rate Deposit
Another strong option comes from Union Bank of India (UK), which has increased its one-year fixed rate to 4.45% AER, placing it within the top 10.
Mr French said: “This week, Union Bank of India increased the rate on its 1 Year Fixed Rate Deposit to 4.45% AER, taking a place within the top 10 when compared to other fixed bonds currently available in the market.”
He added that existing customers may benefit further: “The bank also offers a 0.10% loyalty bonus offered to existing Fixed Rate Deposit holders if they choose to reinvest into another Fixed Rate Deposit at maturity.”
The minimum deposit is £1,000, up to £1 million, but no further additions or early access are allowed. Accounts are opened and managed by post or in branch.
