Investors placing large deposits into offshore savings accounts are reaping the benefits of higher i...
Investors placing large deposits into offshore savings accounts are reaping the benefits of higher interest rates, according to the latest figures from Moneyfacts.
Its Bestbuy list, shows most rates in the offshore market have been tiered to give better interest rates to higher depositors.
Anthony Brand, marketing and business development manager at Singer & Friedlander International (S&F), said this was not uncommon with an increasing number of high-net- worth customers taking advantage of current market rates.
Brand said the S&F base rate tracker 180-day £100,000 deposit offered 4.75%, compared to its £25,000 account at 4.65%.
He also believed it was more competitive to have a higher interest rate for large deposits on monthly accounts because there was less chance of money moving overnight.
In Brand's view, monthly deposits can be used as an income stream for investors. He said using S&F product rates on monthly interest accounts were comparable to notice accounts and fixed terms, which usually offered a higher yield because payment was at the end of the term. "These products suit people who are retiring and would like to invest a large lump sum, but need an income to draw on," he added.
However, Wendy Shimmin, marketing manager at Britannia International, said administration costs on products also played a factor when determining interest rates.
She said the interest rate on Britannia's Base Rate Saver no notice account, 4.65%, was higher than its monthly account, 4.35%, because of the lesser administration costs involved.
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