Private accounts taken up for package rather than rate

Premier private bank accounts do not have a very high interest rate compared to high street banks and are often taken out for the additional benefits they provide, says an expert.

Samantha Owens, head of personal finance at Moneyfacts, said customers must have high balances to receive any credit interest, which would not be particularly high compared to other accounts.

However, she noted that people open premier private bank accounts because of the benefits they offer, such as investment advice and access to bank managers.

Commenting on who might find this type of account most useful, Ms Owens said: “People who are worth a lot of money, basically… They’re not really for people to just walk in off the street.”

Yet such accounts appear to be gaining in popularity, with Schroders reporting earlier this month that its private banking pre-tax profits were up 54 per cent with a net income rise of 11 per cent.

Ms Owens said that Coutts pays 0.15 per cent on a balance of £5,000 and offers free banking for customers who have over £2,500 in their accounts.

Tags: high street banks, investment, finance, bank accounts, people open premier