This week Wilmington Trust started a new online division at WTDirect which is offering a savings account with a 5.26% APY. To maintain this high rate, a minimum deposit of $10K is required. One unique feature is that you get 5.26% APY on any balance for the first 60 days. This allows you to open the account with a small initial deposit. You can then slowly start transferring in money as you get more comfortable with the bank. I don't like tiers like this, but if you're going to have tiers, this is a good way to do it. Once the 60 days are over, balances under $10K only earn 0.60% APY. At least there are no monthly fees.
Unless a bank does what E-LOAN did and start an online savings account with a very high rate, it's hard for a bank to set itself apart from all the other ones that are now out there. WTDirect isn't doing anything outstanding. The interest rate is very competitive, but several others are higher. However, I'm glad to see it trying to offer features to set itself apart from others. For example, it clearly states "No checking account required in order to get the high rate." (unlike Citibank and Washington Mutual). Also, it states "we allow transfers between WTDirect and your other financial institutions. Some banks require you to use their site for all online transfers." (unlike E-LOAN and ING Direct - although you can still do this kind of transfers, but it's against their TOS). They have no limit on the number of linked accounts (unlike E-LOAN, EmigrantDirect, ING Direct and many others). Another feature useful for those with lots of money is allowing transfers up to $500K per month and $200K per transaction (unlike Apple Bank's Grand Yield Direct with a limit of $25K per day and $50K per month).
All banks seem to be cautious in stating the time it takes to transfer money between banks. WTDirect is no different. It states transfers may take from 3 to 5 business days. However, they do state that transfers from another financial institution will be available "immediately upon receipt of funds in your account." (excluding the initial deposit). Another feature they advertise to set itself apart from others is that they "continue to pay interest on your transfer amount until and including the day the funds leave our bank."
WTDirect's FAQ is better than FAQ's from many other banks. They also have better contact features than many (7-day a week toll-free number, email and a secure messaging system).
One thing I couldn't find was if they do a hard credit inquiry when you open the account. I haven't tried contacting the bank's CSR about this. If you find out about this, please leave a comment.
One complaint that I have is that there's no obvious link between their parent bank, Wilmington Trust, and the WTDirect website. There's no mention of WTDirect at Wilmington Trust's website. The reason I would like to see a link is that Wilmington's FDIC page only lists the Wilmington Trust's web address, not WTDirect's address. It's not easy to prove WTDirect is part of Wilmington Trust. However, I very much doubt it isn't legitimate. But it's just nice to get confirmation from the FDIC website. Note, after some searching, I was able to find WTDirect's savings account disclosure (pdf) at Wilmington Trust's website.
Update 8/19/09: The FDIC page now lists www.wtdirect.com as the bank's primary internet address.
Wilmington Trust FSB has a safe and sound rating of 4 out of 5 stars (sound) at Bankrate.com. Update 8/23/08: It now has a 3-star rating (performing) at Bankrate based on 3/31/08 data.
Thanks to the reader who mentioned this new online savings account in the finding deals post.
08/19/09: 1.66% APY
06/03/09: 1.76% APY
03/06/09: 2.01% APY
02/05/09: 2.51% APY
01/22/09: 2.81% APY
12/01/08: 3.06% APY *
08/23/08: 3.31% APY *
02/14/08: 4.01% APY
02/09/08: 4.15% APY *
01/26/08: 4.30% APY *
11/30/07: 4.90% APY
11/18/06: 5.26% APY *
* Rate may have changed on this day