LONDON (Reuters) - An interest rate war in the savings market heated up yesterday as Halifax unveiled a no-strings savings account paying 10 percent.

Its new "regular saver" account will pay a fixed 10 percent for one year, and - unlike other high-interest savings accounts - people need not open a current account with the bank to qualify.

However, those who keep at least £5,000 in a nominated Halifax savings account will earn an extra two percent interest.

It is the latest in a string of high-yielding savings accounts launched in recent months as banks and building societies try to shore up their balance sheets in the wake of the credit crunch.

The offering comfortably beats existing best-buy fixed-rate deals: FirstSave is paying 7.1 percent, Icesave 7.01 percent and the Bank of Cyprus 6.85 percent respectively on their one-year fixed-rate bonds, data from Moneyfacts.co.uk shows.

Regular monthly deposits of £25 to £500 must be made by standing order into the Halifax account, and no withdrawals are allowed during the year to achieve the 10 percent rate.

Open to new and existing customers, it is available for six weeks from Monday to July 20.

Andrew Hagger, PR and communications manager at price comparison website moneynet.co.uk, said: "The intensity of competition in the savings market shows no sign of abating, with big names coming to the table with new highly competitive products on almost a weekly basis.

"(But) double digit savings rates are usually very hard to come by and those that do come to the fore usually require you to transfer your current account as part of the deal.

"You'll need to get your skates on or miss out on one of the best savings deals seen for a number of years."