Nationwide's BMR is already the lowest amongst high street lenders, they say, and this move will maintain that position as well as reduce monthly payments for a borrower with a £150,000 interest only mortgage by £62 a month.
The standard variable rates of the Derbyshire and Cheshire building societies will also fall to 3.50% from 1 February 2009.
As Nationwide holds its guarantee that BMR will never be more than 2% above the Bank of England Base Rate, any further rate reductions will also be passed on by the Society in full.
Nationwide is one of a few lenders to have this type of guarantee in place.
