The Bank of England raised the base rate for the twelfth consecutive time yesterday and it now stands at 4.5%. This is likely to cause considerable pain for mortgage borrowers but could push saving rates higher. Indeed, some lenders are already passing on the uplift.

Skipton increase savings rates

Skipton Building Society will pass on the 0.25% to its variable rate savers but will not apply the increase to mortgage variable rates or SVRs.

Customers who have existing tracker mortgages will see the account interest rate change subject to any product rate cap, and this will rise no later than 11 May.

Rates for existing base rate trackers will be available until 10pm on 14 May, and new rates reflecting the new rise will be available from 9am on 15 May.

Charlotte Harrison, Skipton’s CEO of home financing, said that passing the 0.25% rate onto savers meant that there would be no variable rate savings account paying less than 2.55% from Monday 22 May.

She said: “We know the increase is good news for our savers, but for the millions of people who are due to come off a fixed rate mortgage product in the next few months and potentially onto an SVR, a base rate increase is unwelcome news.

“And to those people I can share that Skipton will not be increasing our mortgage variable rate or SVR as a result of today’s anticipated announcement. This means for the bulk of our mortgage customers – those not on base rate tracker linked products – there will be no increases to their payments.”

Coventry passing on the rise

Coventry Building Society said that it would increase the rates for variable savings members and hold the SVR for borrowers.

Ian Biggs, head of product performance at Coventry Building Society, said that it was the 11th time it had passed on a variable savings rate increase, and keeping the SVR the same would ensure borrowers “see no changes to their mortgage interest rate, demonstrating our commitment to delivering excellent long-term value to all our members”.

He added: “We’re proud of our track record of offering higher rates than the market average and last year, we paid an additional £230m in extra interest to savers than if we’d simply paid the market average.

“Whether our members are saving for their first home, have entrusted us with their life savings, or borrowed money to purchase their dream house, our aim is to always offer great value both now and in the future.”

HSBC and Santander up tracker rates but keep SVR stable

In an update, HSBC said that from today all tracker rates would include the increased base rate and there would be no changes to is residential SVR or buy-to-let SVR.

Santander said that tracker products would be increased by 0.25% from the beginning of June, with payments changing from July onwards.

Alliance and Leicester tracker deals will go up by 0.25% from the beginning of June, and payments will also change from the start of July.

The SVR for Santander and Alliance and Leicester is not changing and staying at 7.5%.