With effect from May 1 2012, the banks’ SVR will move from 4.59% to 4.95% – the change will affect 30,000 of its existing mortgage customers.
The change will mean an average increase in repayments of less than £30 per month.
This is the first change to the banks’ SVR in over three years, and the bank says it reflects the increased cost of borrowing associated with the provision of mortgages.
Until July 31 2012, its standard mortgage exit administration fees will be waived for impacted customers wishing to re-mortgage to another provider.
Steve Reid, retail director at the banks, says: “While our SVR will continue to remain competitively below a number of other UK mortgage providers, the market and costs associated with providing mortgages have changed significantly in the three years since the rate last moved.
“We don’t take such decisions lightly and fully appreciate the impact this will have on some customers but you only have to look at the narrow gap between longer-term savings rates and mortgage borrowing rates to see how things have changed.
“This change will help enable us to continue to support savers and maintain the competitiveness of our deposit rates. Our commitment to the mortgage market, including strong support for first-time buyers as one of only a handful of lenders who have consistently offered 95% LTV mortgages, remains as strong as ever.”