Dedicated to Deposits: Deals, Data, and Discussion

4.05% 7-Month / 4.05% 12-Month CD at a California Bank (Vineyard)

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Vineyard Bank is offering a special 4.05% APY for a 7 and 12-month CD. The minimum deposit is $1,000. The maximum deposit is $95,000 per household. If a Vineyard Bank checking, savings or money market account is opened in conjunction with the CD, the maximum deposit is $5 million. The offer is only available to California residents.

I last reported on this bank in April when they were offering a 3.90% 3-month and 3.60% 7-month CD.

Financial Health

As I reported in the last post, Vineyard has been hit hard by bad home loans. According to this San Bernardino County Sun article:
Vineyard is so troubled that it's on the hunt for money to satisfy regulatory requirements. The bank's connection with the Inland Empire's real-estate mess is emerging as it reports millions of dollars in loan losses.

Over the last year, Bankrate's rating of Vineyard has fallen from 4 out of 5 stars to only 1 star (data as of 12/31/07). So make sure you keep your deposits under the FDIC limits.

Branches are located in several cities in Southern California including San Diego, Manhattan Beach, San Dimas, Walnut, Irvine, and Upland. The bank has been FDIC insured since 1981 (FDIC certificate # 23498).
  Tags: California, CD rates

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Comments
2 comments.
Comment #1 by O-Qua Tangin Wann (anonymous) posted on
O-Qua Tangin Wann
If Vineyard is truly desperate for money, they should be offering a higher rate than 4.05%, and they shouldn't require one open an additional account so people can deposit more than $95,000 in a CD.

If Vineyard really wants big money, they should offer a 5% one-year CD, or copy what AARP Savings did and offer an introductory rate of 4.75% for a savings account. Then they'd get lots of money.

~O-Qua Tangin Wann

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Comment #2 by marc (anonymous) posted on
marc
I think regardless, you wouldn't want to put more than 95k or so in a CD with these guys right now.

BTW, they also have a branch in N. Cal Marin county. Hopefully they are lending to wineries which aren't as affected by the subprime stuff.

I wonder if there is some "reasonable" rule to what CD rates banks can offer, per FDIC guidelines. Otherwise, why wouldn't a bank that knows it's close to going down offer insane junk bond-like rates on long term CD with huge early withdrawal penalties to stay afloat? Perhaps, the terms of FDIC insurance require banks to not get too crazy as the purpose is not to subsidize investor risk taking to get high returns (though this is the effect to some extent to people enjoying high rates from countrywide, indymac, etc.)

1