Update: Butler Bank was acquired by Peoples United Bank which is no longer offering a reward checking account.
Butler Bank has a reward checking account called Butler Advantage Checking which pays 3.25% APY for balances up to $40,000 (0.35% above) and refunds ATM fees (up to $10/month) if the following monthly requirements are met: 1) 10 debit card purchases, 2) one direct deposit or automated debit, and 3) receive eStatements with Online Banking. If these are not met, the rate falls to 0.15%. The minimum opening balance is $25. First order of checks is free.
It appears a branch visit is required to open the account. Please check with the bank to see if there are any other restrictions. Branches are located in Lowell and Andover, Massachusetts, and in Kennebunk, Maine. The bank is FDIC insured (Certificate # 26619). It has $220 million in assets and $197 million in deposits.
Other High Yield Reward Checking Accounts
For more information on reward checking accounts, please refer to one of these posts: reward checking overview, list of reward checking accounts around the nation, and the best checking account post.
11/01/09: 3.25% APY up to $40K
04/01/09: 3.50% APY up to $40K; 0.35% over; 0.15% base rate
09/01/08: Balance cap scheduled to fall from $50K to $40K. APY for above $40K falls from 1.01% to 0.35%
07/29/08: Top yield was 4.00% APY.
04/01/08: Top yield was 4.50% APY.
12/28/07: Top yield was 6.01% APY at the time of the first post.
Edit 12/30/08: Corrected APY above $40K (now 0.35%)