BANKS and building societies were quick to pass on the cost of interest rate rises to home-owners yesterday but did not do the same for borrowers.

Northern Rock announced it would be increasing its standard variable rate by 0.25 per cent to 5.99 per cent. It said rates paid to savers were currently under review.

Mercantile building societies, in Newcastle, Darlington and Tyneside, said rates for borrowers and savers were under consideration.

Abbey was the first of a number of national companies to announce it was passing on the rise to its borrowers, raising its standard variable mortgage rate by the full 0.25 per cent to six per cent from February 9 for new borrowers and March 1 for existing ones.

Barclays and the Woolwich were quick to follow suit, saying they were also raising their standard variable mortgage rate by 0.25 per cent to 6.04 per cent from March 1 for new and existing borrowers.

Britain's biggest mortgage lender, the Halifax, said it was reviewing its rates and would make an announcement in due course.

Nationwide Building Society, Cheltenham and Gloucester, which is part of Lloyds TSB, HSBC and the One account all said they were considering their rates.

The monetary policy committee's decision to raise rates by 0.25 per cent to four per cent will cost home-owners with an average £65,000 mortgage just less than £10 a month.

If lenders pass on the full rise in rates, monthly repayments on a £65,000 loan will increase to £418.79 from £408.91, based on a rate of six per cent.