Further details about quoted household interest rates data

Quoted interest rate series are calculated monthly, as weighted averages for a range of lending and deposit products offered to households.

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Overview

Quoted rates are headline interest rates advertised by banks and building societies for household saving and borrowing, weighted together using business volumes reported by those institutions. Data for February 2019 onwards will be based on the whole market of UK Monetary and Financial Institutions (MFIs), and calculated as monthly averages. Prior to February 2019, quoted rates were based on the sample of MFIs that reported the Effective Rates statistical data (Form ER), and calculated using values at the end of the month. For further details see Forthcoming changes to quoted rates data - 2019 and Introduction of new Quoted Rates Data

Availability

Quoted rates are published monthly via the Interactive Database and Bankstats Table G1.3-Average quoted household interest rates. The data are published on the 5th working day of the following month.  

Data are generally available monthly from January 1995, although a number of series start in January 2011 and January 2012, February 2019.

The data are not seasonally adjusted.

Sources

Rates

Advertised interest rates used in the compilation of quoted rates are obtained from an independent service ‘Moneyfacts’. 

Rates are included only for those institutions that advertise a product closely fitting the definition for each series.  This means that the banks and building societies in the sample may vary from month to month as institutions withdraw from or introduce products to the market.

An average rate is not published if there are fewer than three institutions in the sample for a particular product. This is due to concerns around confidentiality and the average being representative. (See section 5.3.1 in the Statistical Code of Practice).

Weights

Weights used to aggregate different lenders’ interest rates together to create a representative aggregate series are derived from the volume of new business volumes for the product, or the average monthly or quarterly balances. These are reported by institutions on Bank of England statistical and regulatory collections, and the FCA’s Product Sales Data (PSD). The source of weights for each product type is listed in the table below:


Mortgages Fixed-rate bonds and ISAs  Instant access deposits
Credit card and Personal loans  Overdrafts

Owner Occupier (OO) Buy-to-Let (BtL)



Pre-Feb 2019
ER new business mortgage volumes
Quarterly MLAR (Mortgage Lenders and Administrators Return) data
ER new time deposit data, split by fixed-rate bonds and ISA
ER data on the stock of sight deposits
IC (further analysis of credit card lending to UK individuals) data on new credit card lending, and ER data on new other lending
ER data on the stock of overdrafts
From Feb 2019 Quarterly PSD data on new lending flows.  
Quarterly MLAR data
As above for larger lenders (comprising of 90% of the market).
Balance sheet (BE - additional sectoral detail, and BT - balance sheet return) data on the stock of total deposits for the remainder. 
BE data on the stock of deposits
IC and IO data on the value of new credit card and other lending for lenders comprising 95% of the sample. BT data on the stock of lending for the remainder.
ER stock overdrafts data for most of the market. BE data are used for the remainder.
For further information see article: Forthcoming changes to quoted interest rates data 2019.

Interest rates are provisionally weighted on earlier periods’ balances until the relevant period’s data are released.

Definitions

General

Rates are selected for inclusion according to certain criteria; some criteria are applicable to all series, whereas others are specific to the series in question. The generally applicable criteria include:

  • Products must be widely accessible. Some exceptions to this are:.
    • Prior to September 2016 products only available through intermediaries were excluded.
    • Prior to January 2011 products only available through the internet were excluded.
  • All rates are expressed gross of tax.
  • All selected products are denominated in sterling.
  • Fees or cash-back associated with opening or maintaining the product are not included.
  • But fees and cash-backs are taken into account when selecting the most competitive mortgage products.
  • Prior to January 2011 bonus rates were not included, but from January 2011 guaranteed (unconditional) bonus rates are included for some deposit series.

Where more than one product fits the definition for any series, the rate selected is the most competitive with the fewest conditions attached.

When a bank or building society no longer offers a product closely fitting the criteria they are excluded from the aggregate until a relevant product is reintroduced.

Additional information

Secured loan (mortgage) rates

  • The headline advertised rate is selected rather than the APR (Annual Percentage Rate).
  • Fees and cash-back are used to select from the numerous products often available for each bank or building society. The effect of fees and cash-back incentives does not feed into the actual mortgage rate selected. Rates including fees and cash-back are calculated on a loan of £185,000 for the relevant fixation period, with product fees and cash-back spread over the length of fix. The advertised rate for the most competitive product is selected for the quoted rates.
  • Mortgage product definitions – Mortgage rates selected are those available to most borrowers. For example, products restricted to first-time buyers are excluded. 
  • Rates selected are generally those available on loans in the range of £25,000 to £500,000. 
  • Loan-to-value ratio (LTV) measures the loan amount as a percentage of the property value.  Rates selected are the lowest available for loans of 60%, 75%, 85%, 90% and 95% LTV respectively.
  • Fixed term variable-rate mortgages are those that either attract a short-term (two-year) discount relative to the institution's revert-to rate (previously known as Standard Variable Rate or SVR), or add a premium to the Bank of England Bank Rate, or the lenders’ equivalent, for a specific term. 
  • Lifetime tracker products (previously named Bank Rate tracker) are linked to the Bank of England Bank Rate or the lenders’ equivalent rate for their term.
  • Reasonable time margins are allowed for fixed maturity products, as defined in the ER form definitions. For example, mortgages with maturity between 21 and 27 months qualify as a two-year loan. 
  • Fixed term variable rate mortgages are those that either attract a short term (two year) discount relative to the institution's Standard Variable Rate (SVR), or add a premium to the Bank of England Bank Rate, or the lenders’ equivalent, for a short term. Lifetime tracker products (previously named Bank Rate tracker) are linked to the Bank of England Bank Rate or the lenders’ equivalent rate for their term.
  • Reasonable time margins are allowed for fixed maturity products, as defined in the ER form definitions. For example, mortgages with maturity between 21 and 27 months qualify as a two year loan.

Consumer credit rates

The overdraft rates selected are those applicable for authorised (or unauthorised, where no authorised rate is available) overdrafts and are expressed in terms of EAR (Effective Annual Rate). Banks and building societies that charge a fee as opposed to a rate are excluded from the sample temporarily until a relevant rate is reintroduced. 

Four series are published for personal loan rates: for amounts of £3k, £5k, £10k and £25k. The rates are expressed in terms of APR, and no allowance is made for redemption penalties. 

Credit card rates are expressed in terms of APR and apply to standard credit card purchases. For the ‘representative’ credit card series, if an institution offers more than one card, preference is given to the one deemed to be the most widely available. Additional credit card series were introduced from February 2019 for the following categories: 

  • Cards with 0% purchase offers
  • Cards with 0% balance transfer offers
  • Cards with the lowest APR

Deposit rates

Accounts with a restricted number of withdrawals from bank and building societies are excluded from all deposit rate series.

Rates calculated on a monthly basis are included where possible except in the case of fixed-rate bonds and cash ISAs where annual rates are used.

Rates on instant-access savings accounts are selected for £1,000 balances. Two rates series are available from January 2011, one including and one excluding guaranteed bonuses.

Rates on cash individual savings accounts (ISAs) are selected for the ISA allowance at the time.

Two series for variable-rate cash ISA rates are available from January 2011, one including and one excluding guaranteed bonuses. A series for 1-year fixed-rate cash ISA is also available from January 2011. A new series for 2-year fixed-rate cash ISA is available from January 2012, and was first published in October 2016.

Rates selected for 1 year fixed-rate bonds have a fixed initial maturity of between 12 and 17 months. Similarly, rates selected for 2 year fixed-rate bonds have a fixed original maturity of between 18 and 29 months, and rates selected for 3 year fixed-rate bonds have a fixed original maturity of between 30 and 41 months. These series, introduced in November 2012 and October 2016 respectively, have data back to January 2012. Rates on fixed maturity deposits are selected for £5,000 balances. Interest is calculated annually.

Prior to January 2011 all deposit series were compiled using branch-based rates only, with the result that rates available only via the internet were not included. Similarly, guaranteed (unconditional) bonus rates were not included.

In order to maintain the relevance of the series, the ISA, instant access and other time series compiled on this basis were discontinued after December 2012 and replaced with ISA and Instant Access series including internet-only rates and guaranteed bonus rates.

Series for branch-based rates excluding products available only via the internet, and excluding all bonuses are available for periods from 1995, and were discontinued after December 2012.

Series for branch-based ISA rates excluding products available only via the internet, and excluding all bonuses are available for periods from 1999, and were discontinued after December 2012. Unlike the other ISA series, this series was weighted using balances on Form BT.

Updates and Revisions

Quoted rates are published as monthly averages on the 5th working day of each month. This average is updated with the latest weights on the 5th working day of the following month. The mortgage rate series are provisionally weighted on the previous quarter’s balances for new business amounts, and updated with the concurrent quarter’s new business balances when it becomes available. Other data are weighted with the previous month’s data, and then updated the following month when data for the concurrent month becomes available. 

Data can also be revised as a result of additional information or corrections to the existing data. In practice, such data revisions rarely occur beyond two years. Significant revisions to back data will be footnoted in the month in which the change occurs.

Valuation and Breaks

Most of the quoted rates series start from January 1995, beyond which point separate series were published for banks and building societies, with weights derived from balance sheet returns for banks, and from FSA data for building societies. 

The following major changes were implemented in January 2008 when the current methodology was introduced:

  • The sources for weighting data were changed
  • The sample was updated
  • The combined bank and building society series were made available back to January 2005
  • The number of series published was reduced
  • The separate bank and building society series and some combined bank and building society series were discontinued from December 2007

In January 2011, as a result of the optimisation of the effective rates sample (Form ER), the quoted rates sample was updated. The only series showing an effect greater than 0.1pp at the time was £5k personal loan (IUMBX67), where the effect was -0.2pp.

In November 2012, changes were made to some quoted rate series: several new deposit series were introduced and some were discontinued, weights were improved and certain criteria were changed to reflect changing market trends.

The largest revisions to existing series were to both personal loans series, the resulting revisions greater than 0.1pp were as follows:

Effect on Personal loan -£5k (IUMBX67) Effect on Personal loan -£10k (IUMHPTL)
2009 Jan 0.38 2009 Mar 0.20
Feb 0.31 Apr 0.26
Mar 0.36 May 0.18
Apr 0.44 Jun -0.45
May 0.40 Jul -0.55
Jun 0.20 Aug -0.24
Jul -0.69 Oct -0.27
Aug -0.51 Nov -0.31
Sep -0.60 Dec -0.43
Oct -0.46 2010 Jan -1.04
Nov -0.45 Feb -1.11
Dec -0.64 Mar -1.08
2010 Jan -1.32 Apr -1.00
Feb -1.34 May -1.08
Mar -1.23 Jun -1.00
Apr -1.07 Jul -0.97
May -1.08 Aug -1.10
Jun -1.08 Sep -0.88
Jul -1.37 Oct -0.90
Aug -1.48 Nov -0.88
Sep -1.05 Dec -1.69
Oct -1.41 2011 Jan -0.81
Nov -1.44 Feb -0.70
Dec -1.70 Mar -0.74
2011 Jan -1.60 Apr -0.88
Feb -1.40 May -0.19
Mar -1.32 Jun -0.33
Apr -2.83 Jul -0.37
May -2.16 Aug -0.47
Jun -2.22 Sep -0.18
Jul -2.08 Oct -0.16
Aug -2.08 Nov -0.14
Sep -2.21 Dec -0.21
Oct -2.02 2012 Jan -0.18
Nov -1.94 Feb -0.54
Dec -2.07 Mar -0.72
2012 Jan -2.18 Apr -0.80
Feb -2.78 May -0.65
Mar -2.69 Jun -0.69
Apr -2.71 Jul -0.46
May -2.34 Aug -0.42
Jun -2.51
Jul -2.52
Aug -2.52
Sep -2.69
Oct -2.48

As a result of improved weights and changing criteria to the 1 year fixed rate bond series, the following revisions were also published in November 2012.

1 year sterling fixed rate bond (IUMWTFA)
2011 Jul 0.11
2012 Mar -0.11
Jun 0.12

Any structural change to back data in the quoted rate series will be footnoted in the month when the change occurs.

All significant methodological changes will be detailed in a footnote published in the month when the change occurs.

In October 2016, weights used in quoted rates series were improved back to January 2016. The weights are now more closely aligned to the products. The impacts are shown in the table below:

Series Min absolute
impact (bps)
Max absolute
impact (bps)
Absolute
average impact
(bps)
Lifetime Tracker 12 25 17
2yr fixed 75% 0 3 2
2yr fixed 90% 1 6 3
2yr fixed 95% 0 2 1
3yr fixed 75% 0 2 1
5yr fixed 75% 1 5 3
5yr fixed 95% 0 4 1
1yr fixed-rate bond 0 7 3
2yr fixed-rate bond 0 13 5
VAR ISA inc bonus 3 12 6
VAR ISA excl bonus 11 21 15
1yr FR ISA 2 26 11

From March 2019 a number of changes were introduced to quote rates. These are explained in Introduction of New Quoted Rates Data. The table below shows the average impact of different methodological changes on illustrative rates for August and September 2018.

 

Average change in QR

Impact of changes on series (pp)

Product

(pp)

Product selection

Weighting

End-month to average month rates

Mortgage criteria***

Sample change

Mortgages

 

 

 

 

 

 

Revert-to-rate*

-0.10

0.03

-0.22

-0.03

0.00

0.12

2yr var 75% LTV

0.12

0.07

0.09

-0.03

0.00

-0.01

Lifetime tracker

0.01

0.00

0.02

-0.01

0.00

0.00

2yr fix 60% LTV

-0.04

-0.01

0.00

0.02

-0.09

0.04

2yr fix 75% LTV

0.01

-0.05

0.05

0.00

-0.01

0.02

2yr fix 85% LTV

-0.05

0.00

-0.03

0.00

-0.07

0.05

2yr fix 90% LTV

0.05

-0.11

0.15

0.03

-0.04

0.02

2yr fix 95% LTV

0.12

-0.10

0.15

0.09

-0.01

-0.02

3yr fix 75% LTV

0.11

0.02

-0.05

0.00

0.00

0.14

5yr fix 75% LTV

0.03

-0.01

0.01

0.00

0.00

0.02

5yr fix 95% LTV

0.06

-0.01

0.09

0.11

0.00

-0.13

10yr fix 75% LTV

-0.07

-0.03

-0.10

0.05

0.00

0.00

BTL 2yr fix 75% LTV

-0.17

-0.59

0.34

-0.06

0.00

0.13

Consumer Credit

 

 

 

 

 

 

£5k personal loan

-0.22

-0.03

0.10

0.00

 

-0.29

£10k personal loan

-0.05

-0.02

-0.02

0.00

 

-0.02

Credit card**

0.81

0.61

0.05

0.09

 

0.06

Overdrafts

-1.24

-1.16

0.01

0.00

 

-0.09

Deposits

 

 

 

 

 

 

Instant Access+bonus

0.13

0.12

-0.03

-0.01

 

0.05

Instant Access-bonus

0.13

0.12

-0.03

-0.01

 

0.05

Var ISA+bonus

-0.01

0.01

0.06

-0.02

 

-0.06

Var ISA-bonus

-0.01

0.01

0.06

-0.02

 

-0.06

1yr fixed-ISA

0.00

0.00

0.04

-0.02

 

-0.02

2yr fixed-ISA

-0.28

0.00

-0.22

-0.01

 

-0.04

1yr fixed-bond

0.06

0.04

-0.08

-0.01

 

0.12

2yr fixed-bond

-0.01

-0.01

-0.02

-0.01

 

0.03

3yr fixed-bond

-0.01

-0.02

0.10

-0.02

 

-0.07

* “SVR” series has changed to a “revert-to-rate” series.
**Decomposition of difference between old “credit card” series and new “credit card – representative” series.
*** Changes in mortgage selection criteria include changing the representative size of mortgage from £150k to £185k for owner occupier mortgages and including cashback in the consideration of products for inclusion in the calculation of the aggregate.

Further information

Introduction of new Quoted Rates Data Tighe, D, Ratcliffe, A and Brown, M (2019) Statistical article, March
Forthcoming improvements to interest rate statistics Greenish, B and Sanders, B (2016) Statistics article, September
Forthcoming improvements to interest rate statistics Murphy, J and Tibrewal, A (2012) Statistics article, September
Developments in effective and quoted rates statistics Bassi, K (2011) Statistics article, March

This page was last updated 07 March 2019
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