In brief

Savings deals slashed despite base-rate hold

Banks and building societies are continuing to cut the interest rates on their savings accounts despite the fact that the Bank of England has kept the base rate on hold since August.

Last week First Direct cut the rate on its savings account for those investing £500-£5,000 by 0.24, to 2.72 per cent. The previous week Halifax, Nationwide and the AA cut the rates on internet savings accounts by 0.15 to 0.25 per cent. The AA also cut the rate on its phone-based account by 0.25 per cent to 4.61 per cent.

'Even though rates are being cut, institutions continue to be selective with which products are impacted,' said Rachel Thrussell, head of savings at Moneyfacts. 'For example, First Direct has cut rates on some accounts by up to 0.24 per cent, yet their e-savings account remains untouched and offers a headline rate of 4.89 per cent. Existing customers should check the interest rates on accounts to ensure they are still getting the best deal.'

Earlier this month Natwest, Royal Bank of Scotland, Woolwich, and the West Bromwich and Scarborough building societies also made cuts in rates of 0.15 -0.4 per cent on various savings accounts.

Lenders enter bidding to offer best mortgage

A mortgage auction website, where lenders compete for borrowers' business, was launched last week with 14 lenders taking part.

Borrowers looking for a home loan can enter their requirements into Mortgagebundles.com and will be put into a group of customers with similar borrowing needs. Lenders then bid downwards for the 'bundle' of borrowers, and within about two days borrowers are informed which lender is offering the best deal and are invited to apply. Lenders who have signed up to bid for business so far include the Nationwide building society, Stroud and Swindon, Cheshire and TML.

Broker London and Country, however, is not convinced. It is so sure that people will be better off taking 'whole of market advice' that it is mounting a challenge, offering £25 in Marks & Spencer vouchers to anyone who can find a better deal on Mortgagebundles than the product L&C recommends, taking into account any associated fees.

German interest pushes up UK endowment prices

Anyone looking to sell their endowment policy on the open market may get a better price than expected thanks to a wave of new investors from over the water.

Traded endowment company PolicyPlus say that the latest craze among German investors is for British with-profit endowment policies. It says German investment houses are buying these policies in their thousands, resulting in increased demand and higher prices for British policyholders looking to sell.

The Actuarial Profession - the body representing actuaries - warned last week that payouts on long-term with-profits life policies would continue to shrink over the next few years, despite the strong stock market performance that has taken place over the past 12 months.