HSBC has introduced its lowest mortgage rate on record, at 2.99 per cent, but has come under fire for offering it only to its wealthiest customers.

The bank announced the new two-year discount mortgage as it pledged to double its 2007 level of mortgage lending this year, making £15 billion available to borrowers. The new deal is set at 0.95 per cent below HSBC's standard variable rate (SVR), which will fall to 3.94 per cent on February 6.

It will be available only to HSBC Premier customers - those with £50,000 in savings and investments held with HSBC, or those with a £250,000 mortgage with the bank and a salary of £75,000. Customers will need a 40 per cent deposit and there is an arrangement fee of £999.

Melanie Bien, of Savills Private Finance, the mortgage broker, says: “This is a very attractive low rate of interest, but there are two main problems. The first is that borrowers must open a Premier current account with HSBC to qualify - and most people don't want the hassle of moving their current account.

“The second is that, as it is a discounted variable rate, it is connected to the SVR, which is set at the lender's discretion. Borrowers tend to be better off with trackers, which have to follow movements in base rate so tend to be far more transparent.”

HSBC said that it was also re-entering the tracker market, with rates starting at 4.09 per cent for borrowers who have a 25 per cent deposit. It has also introduced a two-year fixed-rate mortgage at 3.99 per cent for customers with a 40 per cent deposit. Its two-year fixed-rate for those with a 10 per cent deposit is set at 6.79 per cent.

Alliance & Leicester announced a new tracker deal at 3.29 per cent for two years, but that is available only for those with a deposit of 40 per cent.

Louise Cuming, head of mortgages at moneysupermarket.com, the comparison website, said: “If lenders are really serious about saving the housing industry from escalating problems, these deals need to be more widely available.”

Northern Rock said that it would pass on only a 0.25 per cent reduction on its SVR to mortgage customers after last week's base rate cut of 0.5 per cent. It means the new SVR rate will be 5.09 per cent from February 1.

HSBC, Lloyds TSB, Cheltenham & Gloucester and Nationwide are reducing their SVRs by 0.5 per cent; Halifax, Royal Bank of Scotland and NatWest are passing on half of the cut.

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