Investec Private Bank’s Savings Index 16 June 2008
Dramatic increase in savings accounts using introductory ‘bonus’ rates
• Average ‘bonus’ rate expires in under nine months
The number of savings accounts using ‘bonus’ rates to attract new customers has increased by
30% since October 2007, according to new research from Investec Private Bank (‘Investec’).
Analysis of Investec’s latest Savings Index (the ‘Index’)1, reveals that of the 924 accounts
reviewed, 151 feature a ‘bonus’ rate which expires on average in less than nine months.
The Index, which analyses savings accounts for balances of £25,000 or more, shows that
not only has the number of accounts reliant on ‘bonuses’ to boost their rates increased,
but so too has the average ‘bonus’ size. Furthermore, the average lifespan of the bonus
has shortened from 284 days in October 2007 to 265 days. As a consequence, says
Investec, many savers will leave cash languishing in underperforming savings accounts
once their initial ‘bonus’ rate has expired.
However, Investec says that savers do not need to rely on bonuses to ensure good rates
of return. For instance, the Investec High 5 Account guarantees to always pay the
average of the top five best-buy accounts as chosen and published by Moneyfacts.2
The following table outlines how the use of ‘bonus’ rates to attract savers has developed
over the last six months for balances of £25,000:
27 October 2007 27 April 2008
Number of accounts with 116 151
Average bonus size 0.61% 0.70%
Average bonus duration 284 265
Linda McBain, Head of Banking, Investec Private Bank, said: “Banks are more
frequently boosting their headline savings rates using appealing short-term bonuses.
While these can seem attractive, the reality is that savers need to take a long-term view.
“It is impractical to continually switch savings accounts to take advantage of introductory
bonus rates. In reality inertia usually takes control and, having been attracted by the initial
headline rate, many savers will leave their cash in the same account regardless of what
happens to the rate. It is imperative that savers find an account that offers not only a
competitive rate but also guarantees consistency.”
Investec Private Bank does not rely on bonuses to offer attractive returns. It aims to
provide its clients with some of the most consistently competitive rates in the savings
marketplace and to be as transparent as possible with them. The Investec High 5 account,
which always pays the average of the five best-buy accounts as chosen by the
independent financial product research company Moneyfacts, currently pays 6.51% gross
To find out more about the Investec High 5 Account or Investec Private Bank’s other
unique cash products, please call 0845 366 6333 or visit
- Ends -
For further information please contact:
Investec Private Bank 020 7597 4127
Citigate Dewe Rogerson 020 7638 9571
NOTES TO EDITORS:
Investec Private Bank’s Savings Index tracks on a six monthly basis interest rates on savings
accounts for balances of £25,000 using data provided by Moneyfacts.
The rate is based on the average of the top 5 savings rates published on the Moneyfacts website
www.moneyfacts.co.uk across the categories of no notice accounts, notice accounts, internet
accounts, monthly interest accounts, accounts for the over 50’s and accounts with an introductory
The Annual Equivalent Rate (AER) is a notional rate, which illustrates the contractual interest rate
as if paid and compounded on an annual basis and is subject to variation. The rate is correct as at
4 June 2008.
Investec High 5 Account
• The product is available for a three month notice term. If an early withdrawal is required a fee
• There is a minimum investment of £25,000 and a maximum of £100,000 (sterling only)
• Investec Private Bank will use the interest rates published on the Moneyfacts website each
Tuesday and update the rates for the account every Wednesday
• Interest is capitalised monthly either to the primary account or to a nominated same-name
Banking Services is a division of Investec Private Bank. Our Banking team focuses on
providing competitive, commoditised savings and transactional accounts for private clients and
SMEs with balances of £25,000 and over.
Investec Private Bank partners with its clients by providing them with distinctive value in six core
areas: Banking Services, Structured Property Finance, Specialised Lending, Wealth Management,
Trust and Fiduciary services, and Growth & Acquisition Finance. It seeks to achieve this through a
‘backdrop’ of a thorough understanding of clients’ present and future financial objectives. This
approach enables clients to manage their financial position in an innovative and responsible
manner, within an environment of security, discretion and confidentiality.
Investec Private Bank is a division of Investec Bank (UK) Limited, which is authorised and
regulated by the Financial Services Authority and is a member of the London Stock Exchange.
This press release is issued on behalf of Investec Bank (UK) Limited. Registered address: 2
Gresham Street, London, EC2V 7QP. (Reg No. 489604)
To find out more about Investec Private Bank’s range of products and services, please log onto