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Nationwide step down on collar policy

Nationwide has made a U-turn and scrapped its 2.75 per cent tracker collar.

Yesterday it said it was standing by its ‘floor’, which would have meant Nationwide tracker borrowers would have only seen a 0.25 per cent cut in their rates.

But now, in the wake of several of its competitors passing on the full rate cut, Nationwide has acquiesced and has scrapped the limit. Borrowers will now enjoy a 1 per cent cut on tracker mortgages, and a 0.69 per cent on the SVR.

HBOS will only be passing on 0.25 per cent of the 1 per cent rate cut, while Lloyds TSB will pass on the full 1 per cent through its and the Cheltenham & Gloucester brand.

Barclays will pass a 1.15 per cent cut through its Woolwich mortgage arm, but the bank did not pass on November’s 1.5 per cent cut.

Abbey, Northern Rock and RBS are all currently reviewing their strategy.

Chancellor Alistair Darling reiterated the call for all banks, particularly those with partial or full Government backing, to pass on the 1 per cent cut.

On BBC Question Time last night, Health Secretary Alan Johnson demanded answers from HBOS after it only passed on a quarter of the full cut.

He said: “I’d want to know what the logic is behind that. We want these banks to continue to be effective and we want them to continue to ensure their own futures.

“So I think we’d have to see what their rationale is, what the circumstances are in which they’ve made that announcement.”

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