Independent Financial Life Planners Bishop's Stortford: No relief for savers when interest rates rise

Tuesday, 25 August 2015

No relief for savers when interest rates rise

Enable’s IFAs in Bishop’s Stortford know it has been a hard few years for savers and even when interest rates go up they are not likely to benefit from a rates rise. It is thought that banks will hold rates down to improve their profits, according to some recent forecasts from analysts at credit ratings agency Moody’s.

It is widely expected that The Bank of England will slowly increase interest rates over the coming years, but borrowers are the only ones who are likely to notice the difference. “These increases should contribute positively to the banks' profitability since we do not expect them to pass the benefit immediately to savers,” said Moody's Carlos Suarez Duarte. “We think it’s unlikely that UK banks will pass all the benefits of higher interest rates to their customers and therefore, margins should initially improve.”

After the financial crisis, banks had to build up their capital most now have built up large buffers, designed to keep them safe in any future economic downturn so they can now increase lending levels. "As a large proportion of UK banks and building societies have now achieved their capital and leverage targets, competition between lenders has intensified," said Mr Suarez Duarte. "We believe that the increasing loan pricing competition, especially in the mortgage market, will partially offset these improvements [in margins] as banks and building societies try to increase or defend their market share." But it’s not necessarily good news for savers so if you want to make your money work for you Enable’s IFAs can help you explore the options.

Issued by: Enable Independent Financial Life Planners  25c North Street, Bishops Stortford, Herts CM23 2LD Telephone: 01279 755950 - Fax: 01279 657339  Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority. It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us. NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE

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IFA Bishop's Stortford

At Enable Independent we know that our clients trust us and rely on our advice to help them to plan a better, more secure financial future. This is a responsibility that we take very seriously especially because we know that many clients have chosen us on the recommendation of friends and family. Each one of our advisers has deep expertise in their area of specialist knowledge and, as a team, we hold some of the highest qualifications available in the financial advice industry.

Our job satisfaction comes from using our skills to find workable, affordable and flexible solutions to meet our clients needs. Whether we are planning for known future funding requirements such as house purchase, school fees or income in retirement - or for the unforeseen such as job loss, long-term illness or early death, our independence from any product provider enables us to view the marketplace impartially. Our training permits us to look beyond a product's marketing hype and select on the basis of its fitness for purpose.