Nationwide launches dual savings offer
Nationwide is offering customers the chance to bet on the stock market, whilst also earning guaranteed interest, as part of a new savings plan.
The building society's Guaranteed Combination Plan involves customers taking out a one-year fixed-rate savings bond and also putting a proportion of their cash into an equity bond, which is linked to the stock market.
The Guaranteed Savings Bond provides interest of up to four per cent for customers who also take out the Guaranteed Equity Bond.
The equity bond, which is provided by Legal & General, is a six-year investment which earns interest according to how well three stock markets, including the FTSE 100, perform over that time.
If the stock markets reach the maximum potential, savers could receive returns equivalent to 6.99 per cent.
Robin Bailey, Nationwide's divisional director for investments, said the plan was ideal for savers who wanted to maximise returns over the long and short term.
He explained the Combination Plan involved Nationwide returning part of the revenue it received from Legal & General, when it sold their Guaranteed Equity Bonds, to enhance the return on its savings bond.
Mr Bailey added: "This way we're offering competitive rates without risking their capital. Interest rates are at a historic low and we have a duty to balance the needs of both our borrowers and savers."
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