Dedicated to Deposits: Deals, Data, and Discussion

HSBC Direct Lowers Savings Account Rates - Offers More CDs


Online banks continue to cut rates. HSBC Direct just recently lowered the rate on its online savings account from 4.50% to 4.25% APY. HSBC's online savings account hasn't held up well since the Fed started cutting rates. They were quick to drop the rate to 4.50%. Now the account is only 15 basis points above ING Direct's Orange Savings. The only thing we can hope for is another savings account promotion like they did last January. Please refer to my previous post for more details on the savings account.

HSBC Direct has improved their CD offerings. They're now advertising 6 and 9 month online CDs. Unfortunately, their rates are not that great with the top yield of 4.70% APY for a 6-month term and a minimum deposit of $25,000. For a $5,000 minimum the yield is 4.55% APY. The 9-month CD has yields of 4.55% APY for a $25,000 minimum and 4.45% APY for a $5,000 minimum. I haven't looked at their online CD management system, but they claim an online application and the ability to instantly transfer the funds at CD maturity to your other HSBC accounts. If you want easy online CD management, ING Direct is a better option. ING Direct is actually more competitive with rates of 4.70% APY for terms of 6, 9 and 12 months, with no minimum deposit requirements.

For other recent savings account rate drops, please refer to my last weekly rate summary.

  Tags: CD rates, savings account, HSBC

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Comment #1 by Anonymous posted on
I agree with you, Banking Guy. I also am hoping for a repeat on the promotion. This new rate is very poor. However, here's the flip side: The way HSBC makes out with their promotions is to exclude existing deposits. Last time, the promotional rate only applied to new money. By lowering their rate first, they have acted to REDUCE existing deposits within these OS accounts. So I have to confess bottom line I have no clue what they are up to. Even worse, I fear they also might not know!

Comment #2 by Anonymous posted on
I've had HSBC's online saving account and free checking account for the past two years, including when they had the rate promotion. In the early going, I had near the FDIC max deposited with them, when their rates were competitive. But once the Fed starting cutting rates, HSBC went overboard in drastically lowering their rates even more than their competitors. As a result, now, they have about $25 of my money, and maybe less than that if they keep going this same way. In addition, it's REALLY annoying that I can get next business day funds transfers for free from Countrywide and ETrade, but HSBC takes 3 days or longer... WHY?????????? HSBC has totally knocked themselves out of competitiveness.

Comment #3 by Anonymous posted on
I've been with HSBC for years with a Premier Account. They called me and said if I go below 100K in all my types of accounts they will charge $100 a month. Think I'm switching to EverBank after the end of the year.

Comment #4 by Anonymous posted on
Bought a 4 month CD with some savings account money I had at HSBC. I'm stuck for a few more months since I tool advantage of the $75 promotion. CD pays more than the savings account now so why not. Problem is, they hit me with a 3 day hold on funds within HSBC LOL!.