03/03/03 

With the recent base rate cut, Sainsbury’s Bank recognises that many savers will be looking for a better return on their savings and, in response, is launching two new options with guaranteed rates of return without any risk to capital. Both are available for a limited time only.

The Sainsbury’s Bank Guaranteed Bond is available until 19th April 2003 and gives a guaranteed fixed return of 6.75% (net) after two years - equivalent to an annual return of 3.32% (4.15% a year before tax). Investors can invest £5000 or more (no maximum*) and will also receive 1000 Nectar Points. This Bond is designed for taxpayers, as the interest is paid net of tax which cannot be reclaimed.

The Bond is designed for investors who do not need to access their savings for the two year term, however, after six months, investors can withdraw their full investment and close their Bond but will lose the equivalent of 90 days return.

The new Sainsbury’s Bank Guaranteed Premium Savings Account is available until the 28th March and guarantees to pay 3.80% (gross) for the first six months. Thereafter, funds are transferred into a Sainsbury’s Bank Instant Access Savings Account which consistently pays better rates than the majority of similar accounts in the market and has recently been ranked as a top quartile product by independent research experts Defaqto.

Customers just need to commit their savings for six months in order to benefit from the guaranteed 3.80%. However, Sainsbury’s Bank has built in some flexibility so that most investors, should their circumstances change within the six month period, can make partial withdrawals subject to a 5% charge on the amount withdrawn, provided the remaining balance does not fall below £3,000.

The Account is most suitable for non tax payers or those paying tax at the starting or basic rate and anyone opening an account will receive 1000 Nectar Points. The minimum investment is £3,000, maximum is £250,000.

Gail Quinn, Head of New Product Development , said: “It’s tough for savers in the current low interest rate environment. Many savers are currently earning less than 1% on their balances, so we anticipate strong demand for these new options.”

Provided by Sainsbury's Bank