Santander will pass on the full Bank of England base rate rise to a range of mortgage and savings products.
Following the monetary policy committee’s unanimous vote to raise the base rate of interest to 0.75 per cent last week, Santander will increase saving rates by 0.25 percentage points on its eSaver, Junior Isa, flexible saver for kids and Help to Buy Isa with effect from Monday 3 September.
Santander's everyday saver will see a rate increase of 0.1 percentage points to 0.35 per cent from the same date.
Mortgage customers will also see their interest rates rise, with Santander's standard variable rate increasing to 4.99 per cent at the start of September.
The Alliance and Leicester standard variable rate will see the same increase.
In line with the 0.25 percentage point increase to all tracker mortgage products linked to the base rate, the Santander Follow-on Rate will increase to 4 per cent from Monday 3 September.
A Santander spokesperson said the new rates will be communicated individually to customers.
Reza Attar-Zadeh, head of customer solutions at Santander said: "We have carefully considered our options and sought to achieve a balance between the rates we offer our savers and borrowers.
"Despite the continued low interest rate environment, we continue to offer compelling propositions for our customers and are pleased to have been able to increase rates by up to 0.25 per cent on a range of our popular savings products.
"The 1|2|3 Current Account continues to offer a competitive 1.50 per cent on balances up to £20,000 as well as cashback for a monthly fee."
rachel.addison@ft.com
