Banks found slow to pass on rate rise to savers

However, eight have increased the rates on their standard variable mortgage rates by the full 0.25 percentage points.

Research provided by Moneyfacts carried out in the wake of the Bank of England’s August raising of the base rate shows that the average rate for the most popular easy-access savings accounts has barely moved bar a negligible 0.06 percentage points.

This compares with the current base rate rise the rise at the beginning of August now standing at 0.75 per cent.

While last month’s rise was only the second in a decade, it had usually been common practice for banks and building societies to increase their savings rates at the beginning of the following month after a rate rise.

But Moneyfacts found that out of 119 savings providers, 59 have increased rates or will do so, while 47 have not changed or have not announced they will.

The remaining 13 offer fixed rate accounts or are not open to new investments.

Of 80 mortgage lenders, 48 have increased their standard variable rate for their mortgages — affecting two million home owners — with only two providers (Bath Building Society and Principality Building Society) passing on less than the 0.25 percentage point increase.

Lloyds Bank was found to have not yet increased the rate for an easy-access account and Barclays upped one by only 0.05 percentage points.

The research also reported that half of account providers offering variable rate savings accounts are yet to confirm if they will be passing on the full rise.

HSBC, NatWest, TSB and Royal Bank of Scotland increased rates for some of their easy-access savings accounts by just 0.1 percentage points. Santander, Halifax and Bank of Scotland increased rates by the full 0.25.

Rachel Springall, finance expert at Moneyfacts, said: “As a month has passed since the base rate hike, savers will be disappointed by how little impact it has made,” said “Barclays hasn’t passed on the previous interest rate rise, let alone this one, with a 0.15 percentage point rise in December and just a 0.05 percentage point this month on its Everyday Saver.”

Reacting to the report, a Lloyds Banking Group spokesman said: “We will be increasing rates on many of our variable and fixed-rate savings accounts. This includes increases of up to 0.5 per cent in ISAs and up to 0.7 per cent in fixed-rate accounts.”

A TSB spokesman said: “Variable rates for our junior savers have increased by 0.25 per cent as we encourage the younger generation to save for their future. All other savers on a variable rate with TSB have also seen an increase of 0.1 per cent from September 1.”

An HSBC spokesman said: “Our savings accounts are competitive and cater for the different needs of savers. We have increased rates across a number of accounts, including 0.25 per cent on all children’s savings accounts.”