Clydesdale Bank, a former funding line behind bridging lender Dragonfly, has announced that it will waive arrangement fees for customers seeking to purchase a new property, refinance their existing mortgage or those switching to Clydesdale..

According to Clydesdale, the new range could save customers up to £999 on their arrangement fees.

Fellow British National Australia Bank subsidiary, Yorkshire bank, plans to provide the same range.

Speaking on the announcement, Andrew Pearce, Retail Director for Clydesdale and Yorkshire Banks, , said they aim to ensure their ranges suit the needs of different customers.  He said: “Our fee-free mortgage offer is designed to help reduce some of the up-front costs of moving or switching your mortgage.”

The range features a two-year-fix at 2.49 per cent and a five-year-fix at 3.19 per cent and up to 70 per cent Loan To Value.

Alternate discount option is available up to 60 per cent LTV for two years at 2.79 per cent.

Customers refinancing existing mortgages won’t have to pay legal fees if they use the bank’s appointed solicitors.

Last week, rating agency Moodys downgraded Clydesdale bank by 3 notches, taking them from a low credit risk at A2 to a medium grading of Baa2.

This new long term bank deposit and senior debt rating infers that the bank may have some speculative characteristics and moderate credit risk. This was made on the grounds of Clydesdale’s uncertainty of future ownership and direction.

Moodys said a large contributor to the demotion was Clydesdale’s choice to withdraw from commercial lending last year.

Trinity Financial Group’s product and communications manager, Aaron Strutt, fears a change in Clydesdale’s mortgage rates as a result of the downgrading. The manager at the mortgage broker group, added: “...as has been the case with other banks which have been downgraded recently.”

Recently, Clydesdale Bank’s owner, National Australia Bank, has been facing ongoing problems. In a statement to the Australian Stock Exchange, the banking group said that UK cash earning was broadly stable in the last 3 months of June. However, they added this income was levelled out: “...by an increase in expenses largely related to further provisions raised for conduct and redress matters,”