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The Cambridge Launches Inflation Linked Bond

The Cambridge Building Society has today launched its first Inflation Linked Bond in response to customer demand for a product offering protection against the effects of inflation.

The five year bond will pay customers a return, at maturity, that tracks the annual rate of inflation, as measured by the Retail Prices Index (RPI), plus a guaranteed 1.00% gross p.a./AER* fixed for five years.

The variable interest will be calculated annually and will be based on the RPI readings, between 2011 and 2016, published by the ONS in September each year. The latest published RPI reading was 5.2% for May 2011. The overall return will be payable on the maturity date, 16th September 2016.

Andy Lucas, Head of Cambridge Direct at The Cambridge Building Society says: “We have been working on a range of new and innovative savings products to meet customer needs and with the continuing inflation concerns and low base rate, the Inflation Linked Bond is a great proposition for new and existing customers alike. The product is ideal for those customers that want to extend their savings options and get a real return on their cash by beating inflation.”

The bond is on sale until 15th September 2011 and is a limited issue product that will be withdrawn when fully subscribed. Applications opened prior to this start date will earn 1.00% gross p.a./AER fixed until 15th September 2011. From the 16th September 2011 until 16th September 2016 the bond will earn the 1.00% plus a variable rate of interest based on the RPI readings taken each year during that period.

The bond requires a minimum investment of £5,000 and has a maximum investment of £85,000.  Withdrawals are not permitted during the five year term and no additional deposits can be made.

Customers nationwide can now take advantage of The Cambridge Inflation Linked Bond by downloading a brochure and application form (online PDF) and posting with their cheque to The Cambridge Building Society, PO BOX 232, 51 Newmarket Road, Cambridge, CB5 8FF.

To find out more about the Inflation Linked Bond and other savings products, customers can visit or call 0845 601 3344.



Notes to editors:

*Gross rates do not take into account deductions of Income Tax. The Annual Equivalent Rate (AER) is a notional rate which illustrates what the gross interest rate would be if interest was paid and added to the account annually.

For further information, interviews and images, please contact Suzanne Hazell, PR Officer at The Cambridge Building Society  on, 01223 727653 or 07423432851