Leeds Building Society has announced the launch of a 15 month fixed rate bond paying 1.3 per cent a year.
Available as of tomorrow (22 December), the bond allows customers to access 50 per cent of their capital investment before the term ends.
Jaedon Green, director of product and distribution at Leeds Building Society, said while low rates made cash savings products less attractive, there was still demand for fixed rate bonds.
“With half your savings effectively available instantly, the 1.3 per cent rate compares very favourably with what’s on offer out there for most instant access savings accounts," he said.
“The demand for fixed rate bonds remains strong across our range but, as we look to the New Year, many savers may prefer a shorter-term fix after the political and economic upheaval in 2016, which is likely to continue for some months yet.”
He pointed out that Leeds also offered a five year fixed rate bond with a return of 1.55 per cent per annum.
According to Moneysupermarket.com, the best one-year fixed rate bond on the market is provided by First Direct at a rate of 5 per cent a year. Savers must contribute at least £25 a month.
HSBC and M&S Bank also offer one-year fixed rate bonds at 5 per cent. None offered flexible access to the capital.
However, the majority of one year fixed rate bonds listed on Moneysupermarket.com return well under 2 per cent. A large number return under 1 per cent.
Bank of Scotland, Natwest, Royal Bank of Scotland and Santander were joint bottom of the list, all offering 0.5 per cent on one year fixed rate bonds.
james.fernyhough@ft.com
