Update 05/15/09: For existing customers, the rate has fallen to 2.53% APY. The Special Anniversary Savings Account is no longer available for new customers.
Update 04/25/09: The Special Anniversary Savings Account is no longer listed on the bank's website. Contacting bank to find out if account is still available.
Update 03/11/09: APY has fallen to 3.05%.
Update 02/27/09: APY has fallen to 3.56%.
Update 11/26/08: APY has fallen to 4.08%.
Broadway Federal Bank is offering a special anniversary savings account that's paying 5.13% APY with a rate of 5%. There are just a few details listed in the bank's online account page: $1,000 minimum, ATM Card, and it's available only online. Also, the rate is subject to change.
I called this afternoon for more information. The CSR was able to confirm that it is available to people from any state. Also, she confirmed that the rate could change at any time. However, she said this special has been going on now for a year. I checked the Internet Archive and it appears she was correct. There's a page from November 2007 showing this savings account with a 5.00% APY. I'm not sure when it changed to 5.13% APY.
I also asked about other potential restrictions or limitations. According to the CSR, there is no maximum deposit limit or checking account requirement. The online application does allow you to select ACH funding, but I'm not sure if it allows you initiate ACH transfers once it's opened. The CSR didn't seem familiar with these details.
It's important to note that this bank doesn't seem to be the type trying to start an internet bank. There's no toll-free number, and there are no banking reps ready to help with this online account. With the current rate environment, it seems likely that we'll see the rate on this account fall. The question that I can't answer is will the high rate last long enough to make opening this savings account worthwhile.
Update 11/22/08: A reader provided his/her experience with this bank in the comments:
I have an account with them. They did a HARD pull and Chexsystems on me few months ago.
Customer service is very bad.
You must mail picture ID and prove residence.
ACH is very slow and they put random days of hold on the money deposited, from 2-6 days.
If it wasn't for the high interest rate, I would never open anything with them. When the limit of deposit is reached, for sure the rate will go down by at least 2% points.
Another reader provided the following account details:
- It is a tiered account. Balances under $1,000 earn an APY of 0.40%.
- There is a monthly service fee of $10 if the balance falls below $1,000 any day of the month.
- Interest is compounded daily and credited monthly.
The bank has some decent financial ratings for soundness: 3.5 stars (good) at BauerFinancial and 4 stars (sound) at Bankrate.com. These ratings are based on 6/30/08 data.
It's a small bank with 5 offices in Los Angeles and Inglewood, California. The bank has 84 employees, $390.6 million in assets and $256.9 million in deposits based on 6/30/08 data. It has been FDIC insured since 1947 (FDIC Certificate # 30306).
Thanks to the reader who mentioned this savings account in the Finding the Best Deals post.