Banks fail pass on full rate cut

Last Modified: 13 Nov 2008
By: Channel 4 News

Research for this programme shows that mortgage rates have fallen by less than the full 1.5 per cent Bank of England rate cut.

Changes to tracker rates

Alliance and Leicester cut its rates by 0.9 per cent
Part-nationalised Lloyds TSB passed on 0.6 - 0.9 per cent
Part-nationalised The Halifax, passed on 0.86 per cent
Abbey passed on 1.3 -1.45 per cent

Last week Gordon Brown called on lenders to pass on the full 1.5 per cent cut in interest rates to mortgage borrowers.

Most banks passed the cuts on to their standard variable rate customers, but that's only a fraction of the market.

New borrowers who are looking to take out tracker mortgages, which move up and down with interest rates, will see a different story.

Most lenders withdrew their tracker products in the wake of the interest rate announcement, and started re-introducing them yesterday.