Five of the most competitive savings products have been withdrawn within hours of the Bank of England’s shock cut to interest rates today.

The AA, Birmingham Midshires and Saga have withdrawn their best fixed-rate bonds. The organisations, whose savings businesses come under the umbrella of HBOS, which is being taken over by Lloyds TSB, were offering rates of up to 7.21 per cent. The Clydesdale and Yorkshire banks have also withdrawn fixed-rate bonds, offering up to 7.22 per cent.

Experts say that more banks are likely to withdraw their best savings deals in the wake of the Bank of England's cut in the base rate to 4.5 per cent today.

Kevin Mountford of Moneysupermarket.com, the comparison service, said: “Savings rates have been artificially high during the credit crunch as banks have been desperate to bring in deposits. Banks have been waiting for an opportunity to realign its pricing and recover profit margins, and it looks as though the change to base rate has provided this opportunity.”

Saga was offering 7.06 per cent on its nine-month internet bond; Birmingham Midshires was offering 7.05 per cent on its one- year internet bond; and the AA was offering 7.21 per cent on its one-year bond. All these deals have now been withdrawn.

Northern Rock and National Savings & Investments (NS&I), which are both backed by the Treasury and have seen a “sizeable flow” of deposits in recent weeks as savers seek safe havens for their money, have reduced interest rates on their best savings deals this week.

Darren Cook at Moneyfacts.co.uk, the financial information website, said: “If the new funding commitments from the Treasury, announced this morning, do work and liquidity is improved amongst banks, then undoubtedly banks will be less desperate for saver’s cash and savings rates will continue to fall. I would expect to see other savings providers follow suit over the next few days – so savers wanting to snap up the best rates should act fast.”

Savings accounts that follow the base rate, such as the NS&I Direct Isa that guarantees to be 0.30 per cent above, will see an automatic reduction in interest rates. Interest paid on the NS&I's Direct ISA today decreased from 5.30 per annum to 4.80 per cent.

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