Banks are denying savers tax benefits by paying less on fixed-rate cash ISAs than on similar taxable bonds.
In some cases earnings are higher even after tax on a taxed bond than in a tax-free ISA, the Daily Mail reports.
One of the worst examples is Lloyds TSB, which pays 2% on a one-year, fixed-rate ISA, but 2.2% after tax (2.75% before) on its taxable one-year bond.
The best one-year, fixed-rate bond currently pays 3.25% before tax compared with the 3% paid on fixed-rate cash ISAs.
On longer-term money, where banks and building societies are competing fiercely, the gap is wider. Halifax and C&G, both part of taxpayer-subsidised Lloyds Banking Group, pay 4.1% on taxable two-year, fixed-rate bonds, but only 3.5% on fixed-rate ISAs.
If Halifax and C&G paid the same on cash ISAs as on other fixed bonds, savers would make an extra £12 interest on each £ 1,000 they put into a two-year bond. Read more
HOMEBUYERS HOPING last year's 18.6% stock market rise to feed through to higher payouts on their with-profits endowments have been disappointed.
Payouts from Aviva, which announced bonus rates yesterday, have fallen heavily compared with last year, the Daily Mail reports.
Only 4% of the company's 50,000 policies - taken out with General Accident, Commercial Union and Norwich Union - maturing this year will produce sufficient funds to pay off the mortgage.
A 25-year policy invested in the CGNU fund produced £36,979, down 12.6% on the £42,322 paid out on a similar policy last year.
The figures are based on a 25-year endowment taken out by a 29-year-old man paying in £50 a month.
Payouts on a Commercial Union policy are down 13.1% at £30,679, £4,628 less than a similar plan maturing last year. On old Norwich Union policies, the figure is £27,884, down 19.8% on last year's £34,775.
Shortfalls could be slightly cushioned by extra payouts made under the group's Mortgage Promise. Last year it paid an average top-up of £1,192. Read more
FERRERO looks set to back down out of the bid battle for Cadbury, strengthening Kraft's chances of sealing a £10.5bn-plus takeover.
Ferrero announced in mid-November it was interested in a possible bid amid rumours of talks with Hershey about a joint offer, reports the Times.
But the privately owned Italian group is believed to have ended talks with Hershey and pulled out of the running.
People close to the situation have told Reuters Ferrero had broken off talks with Hershey and would not be proceeding with a bid.
Individually, neither Ferrero nor Hershey has the financial resources to buy the whole company and neither has publicly listed shares to offer as a currency. Read more.
CHINESE AUTHORITIES have ordered the country's banks to hold greater reserves in a ahead of a forecast full-blown interest rate increase.
The move comes amid rising fears China could fall victim to a speculative bubble, the Telegraph reports.
The People's Bank of China upped the minimum reserves limit for local banks by 0.5% to 15% of their deposits, just hours after increasing interest rates on its one-year bills to rein in economic activity.
Policymakers in the Asian giant are attempting to slow spending and avoid the economy overheating as global money gushes into the country.
The increase in reserve requirements comes earlier than most economists had forecast. An increase in the country's benchmark interest rates are likely to follow in quick succession. Read more
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