Abbey joins Lloyds TSB and passes full 1.5 percent rate cut: Update

Last night Abbey agreed that they would pass on the full 1.5 percent interest rate cut to their customers, making them the second bank to follow the move from Bank of England Monetary Policy Committee yesterday in an attempt to fight off the recession and improve our ailing economy.

Abbey who are owned by Spanish bank Santander will now join Lloyds TSB and its mortgage arm Cheltenham & Gloucester in being the only two banks to pass on the interest rate cut to their customers. Reducing their Standard Variable Rates which will affect Tracker Mortgages and borrowers with loans linked to the banks SVR. However, Lloyds TSB were under a legal obligation to cut their SVR through a clause in their terms and conditions that there SVR could not be more than 2 percent over the Bank of England’s base interest rate.

The banks listed below are coming under fire from the Government and British Public and being branded by the press as “Greedy Banks” these banks are Royal Bank of Scotland (RBS), HSBC, Alliance & Leicester, Nationwide, Northern Rock and HBOS have not passed on the rate as yet and have said that their SVR are under review.

The UK Government said that the Banks have a duty to their customers and the government to pass on the rate cut, Alistair Darling the Chancellor said the cut was put in place to help the British public by putting more money in thier pockets in an attempt to get the economy moving again.

Source: istockanalyst