MP accuses UK’s biggest banks of being ‘far too slow’ to reward savers
Harriett Baldwin, who chairs the Treasury Committee, said the ‘big four’ banks have not done enough to pass on higher interest rates to savers.
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Your support makes all the difference.The chair of a powerful group of MPs has criticised Britain’s biggest banks for “doing as little as they can get away with” to reward savers, after unveiling their quarterly finances.
Harriett Baldwin, who chairs the Treasury Committee, said the “big four” banks – Barclays, Lloyds Banking Group, NatWest Group and HSBC – have not done enough to pass on higher interest rates to savers.
It comes despite the lenders revealing their financial performance has been impacted in recent months by higher savings rates on the market.
We will continue to press for individual and business savers to be rewarded. Meanwhile, savers should shop around for the best rate
The Conservative MP said: “The big four banks have been far too slow to reward savers through better rates on instant access savings accounts.
“The Treasury Committee summoned them in February to suggest they offer better rates.
“They should have listened to our suggestion as there are signs that savvy consumers are switching for better rates elsewhere.
“The figures published in the past week still show signs that the banks are trying to do as little as they can get away with to reward our constituents for saving.
“We will continue to press for individual and business savers to be rewarded. Meanwhile, savers should shop around for the best rate.”
Over the past week, all four banking giants said higher borrowing costs had helped them generate more income from mortgages and loans throughout the year.
However, in recent months, more customers have been locking cash away into savings accounts to make the most of higher rates.
Barclays said the savings market had become “extremely competitive” and reported a 6% drop in deposits in the UK.
Lloyds, the UK’s biggest mortgage lender, said people were making the most of its own savings deals.
It saw some £3.2 billion taken out of current account deposits and £3.9 billion put into savings over the quarter.
And NatWest revealed that 15% of its customer deposits are now in fixed-term accounts which pay better interest rates, up from 8% in the first quarter of the year.
Overall, customer deposits across the group grew by £2.4 billion between July and September, compared with the previous three months.
The Treasury Committee, a group of cross-party MPs who scrutinise the work of the Treasury, earlier this year pressed bank bosses to explain why some of their savings rates were still significantly lower than the Bank of England base rate.
Top rates on savings accounts have been rising since, with smaller specialist banks such as Paragon Bank matching the current 5.25% base rate on its easy-access savings account.
Earlier this month, NS&I withdrew one-year bonds paying 6.2% interest from sale, after nearly a quarter of a million savers snapped them up in just over five weeks.