New sharesave rates to apply from 27 February

Higher interest rates are to apply to new savings contracts linked to sharesave or save-as-you-earn (SAYE) schemes from 27 February 2011.

The rates have been adjusted as the fixed-gap margins between the bonus rates and market reference swap rates were breached on 31 January.

The new rate for a three-year savings contract is 0.1 (previously 0.0) x monthly contribution, with an annual equivalent rate of 0.18% (previously 0.0%).

For a five-year contract, the rate is 1.7 (0.9) x monthly contribution; the annual equivalent rate is 1.10% (0.59%).

For a seven-year contract, the rate is 4.8 (3.2) x monthly contribution; the annual equivalent rate is 1.7% (1.15%)

The early closure rate is 0.12%, increased from 0.0%.

Read more articles on employee share schemes