http://business.timesonline.co.uk/tol/busi...icle3176413.ece

"ICESAVE, the savings provider owned by Icelandic bank Landsbanki, will turn up the heat in the tax-free savings market when it launches its first cash Isa tomorrow.

The account will pay 6.1% on balances above £1,000 – the best easy-access rate available. Savers can transfer money over from other cash Isas, as well as invest this year’s allowance."

Sounds like the new home for my NS&I ISA from April if BoE rates continue to slide.

I just had a scan of the FSA tables (http://www.fsa.gov.uk/tables) and there are slightly better deals out there on ISAs, although they all have various restrictions or include 'bonus' rates or other arcanery and / or are from barge-pole operators such as Bradford and Bingley and Northern Rock.

Well, I'll be seeing what the lie of the land is like come 6th April.

Same here, unfortunately for me my monies are with one of those 'barge-pole operators' so I will be looking for a new home for them. The Icesave ISA does look good, in that it allows transfers in, the rate is not too bad and there are no silly bonuses.

Halifax do fixed 1 year for 6.4 - no payments in though and must stay there.

Can set-up another ISA though after April 6th.

So, any reason NOT to go for Icesave's ISA?

EDIT: I'm also considering NS&I's Direct ISA. Would this be safer than Icesave?

NS&I would certainly be safer. However the NS&I ISA's interest rate moves completely in stock with the BoE rate. So simply put it's BoE rate + 0.55%. And you can't transfer previous years' ISA balances into NS&I.

With Icesave as the ISA product is brand-new it remains to be seen what they'll do should interest rates rise / fall. They have a good record of passing on BoE rate increases and they've not dropped rates on their savings accounts yet though despite December's rate cut.

If I was more financially savvy, I'd understand more of the following, but it doesn't sound good:

"Then there are the foreign banks. If it's Icelandic, then be afraid; these banks are starting to be priced for bankruptcy risk and it's not clear what protection UK savers might have. Landsbanki (owner of the popular Icesave internet banking business) has to pay the credit markets 3.2% more than the risk-free rates and 2.45% more than ING does for funds. Perhaps, just perhaps, we should pay more attention to the risk side of the equation [than to just the interest rate]." (From How safe is your bank deposit? by James Ferguson in the Feb 1st, 2008 edition of Money Week.)

This link has been posted on the main thread:

http://www.telegraph.co.uk/money/main.jhtm...iceland103.xml#

and discussed accordingly;

http://www.housepricecrash.co.uk/forum/ind...showtopic=67445

I am posting this here because of its relevance and the fact that threads stay here for a lot longer

Yeah, saw that thread. But I didn't want to spoil a good bear-fest.

Sounds like great news to me. If Icesave lose customers because of this they'll just have to increase interest rates to attract more business. And with Icelandic rates as high as they are (13.25%) they sure have some wriggle room to do that. UK customers are the hard-core easy money for them, even with costs of setting up shop here in Blighty, their margins must be enormous.