Dedicated to Deposits: Deals, Data, and Discussion

High Yield CDs at Lehman Brothers Bank


Lehman Brothers Bank FSB has some competitive CD rates. The best CD yield is 5.50% APY for a 60 month term. The minimum deposit is $1,000. These same rates also apply to IRA CDs. The CD rates as of 9/23/07 are as follows:

Term Rate APY
6 month 5.10% 5.23%
12 month 5.20% 5.34%
18 month 5.20% 5.34%
24 month 5.25% 5.39%
36 month 5.30% 5.44%
48 month 5.30% 5.44%
60 month 5.35% 5.50%

According to the terms and conditions, the interest will be credited to the account or paid out quarterly. The early withdrawal penalty is 180 days of interest on the amount withdrawn for terms of over one year. The grace period when you can make penalty free withdrawal after maturity is 7 calendar days.

I called the bank on Friday, and the banking rep said that the options to fund the CD include wire transfer (free), check or a transfer from a Lehman Brother's checking or savings account. You cannot fund with an ACH transfer from an external bank account. The banking rep said that the rate is guaranteed only when they receive the funding. If you mail a check, you can include a note with instructions not to open CD if the rate has dropped. I was also told that they do not open accounts with beneficiaries. When the CD matures, you can close the CD and receive the funds either by wire transfer ($15 fee), by check (free) or by requesting a transfer to your Lehman Brothers' savings or checking account.

The bank is FDIC insured (Certificate # 30890). It has a 3 out of 5 safe & sound star rating (performing) at based on 3/31/07 financial data.

  Tags: CD rates, IRA rates

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