Dedicated to Deposits: Deals, Data, and Discussion

5.25% Savings Account at Transportation Alliance Bank

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Transportation Alliance Bank (TAB) just increased the rate of its Premium Savings Account to 5.25% APY. The initial deposit requirement is only $25, and there's only a $1 minimum balance requirement to earn the full interest. According to the fee schedule (pdf) there are no monthly fees.

The Money Market Account also had a major rate bump. The rate is just a tad lower than the savings account at 5.15% APY. The advantage of the money market account is that it has check writing privileges (up to 3 a month). It has the same deposit and balance requirements as the savings account.

Note, TAB listed these rates this morning as 5.38% APY on the savings and 5.28% APY on the MMA. They must have made a mistake, and lowered them later in the day. This doesn't help provide confidence in their ability to maintain high rates.

The rates on both the savings and money market account had been 4.50% APY since I first reported on these accounts last March. The good thing about this is that TAB doesn't seem to change its savings account rates often. The bad news is that this is a big jump in rates so it smells like a promotional rate.

One downside with TAB is that it doesn't seem to have the best online banking features. The new account application and ACH authorization form must be printed and mailed or faxed in. The ACH authorization form states that the total of all outstanding ACH transfer requests may not exceed $1,000. There is an Express ACH that has increased transfer limits, but according to the application this authorizes TAB to review your credit report (perhaps a hard pull?). And according to the FAQ, you can only apply for ACH Express 90 days after opening your account. Also, according to fee schedule, outgoing ACH's cost $2. Incoming ACH's are free.

Some other details from the FAQ and fee schedule about these accounts include: Incoming wire transfers are free. Outgoing wire transfers cost $15. Interest on a Savings Account is compounded daily and credited monthly. Initial deposits that are not guaranteed funds have a 10 business day hold before they can be withdrawn. Most future deposits may be withdrawn after three business days. A paper statement will be issued monthly.

Even though TAB hasn't maintained competitive savings account rates before today, it has maintained competitive long-term CD rates. The CD rates also went up today. The highest rate is the 12-month CD with a yield of 5.40% APY.

TAB is designed as a virtual bank in which all transactions can be done via the bank's website or by phone. The bank doesn't have bank branches but has several financial service centers under its parent's name Flying J Inc. These centers are staffed with sales associates who market bank products. The centers are located in Ogden, Utah; Lake Point, Utah; Walton, Kentucky; and Resaca, Georgia. TAB has been FDIC insured since 1998. As of September 30, 2006, TAB reported $466.6 million in total assets. It has a 4 out of 5 safe-and-sound star rating at Bankrate.com.

[2/26/07 6:40pm Edit. Updated the savings account and MMA rates. They were temporarily listed higher early this morning.]

  Tags: savings account

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Comments
2 Comments.
Comment #1 by Christopher (anonymous) posted on
Christopher
I just clicked on your link and the web site says the APR is 5.25%...

1
Comment #2 by Banking Guy (anonymous) posted on
Banking Guy
This APY sure didn't last long. Looks like TAB made a mistake this morning with the 5.39% APY (5.25% APR).

The rate listed as of now is 5.25% APY for the savings and 5.15% APY for the MMA.

Thanks for the comment.

1