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2.90% 12-Month CD & 2.50% Savings Account at Hudson City Savings Bank - Nationally Available


Hudson City Savings Bank

Update 3/19/10: The Internet Money Market Savings APY has fallen from 1.25% to 1.15%. Please check the bank's website for the latest rates.

Hudson City Savings Bank is offering some fairly competitive rates on its online CDs and money market savings account. These include a 2.90% APY 12-month CD, a 2.65% APY 6-month CD and a 2.40% APY 3-month CD. Minimum deposit is $5,000. The savings account has a rate of 2.50% APY with a $2,500 minimum balance. The rate for balances of $10 to $2,500 is 1.50% APY. A $2 monthly fee applies to balances below $100. These rates are listed at the bank's internet accounts page as of 2/11/09.

I called the bank this morning and confirmed that these accounts can be opened online from any state. The application is provided by the Andera service which is common for online applications. Initial funding can be done by electronic ACH transfer.

According to the CSR, the bank started offering the internet accounts in early December. This might explain why these accounts don't seem to have the best online features. Here are a few of the money market savings account features that I was told during my conversation with the CSR:

  • no bank-to-bank ACH transfer service
  • accepts ACH transfers from another bank
  • deposits can be also be made by mailing checks
  • No check writing

And here are some of the internet CD features I was told by the CSR:

  • $100,000 ACH deposit limit, no limit for mailing in a check
  • Rate locks when the application is submitted
  • At maturity, ACH transfer or wire transfer are not options
  • Rates typically updated on Fridays

Their Internet Banking Department can be reached at 201-967-1900, Ext. 1887.

Strong Financials

The rates are competitive but are not the best. However, one positive aspect of this bank is its strong financials. Hudson City Savings Bank is one of the few banks with internet accounts that seem to be in good financial shape. According to this Business Week article "Hudson City has avoided the worst of the mortgage crisis because of its conservative lending policies before the economic crisis hit." Their 4th quarter performance was a little below expectations, but they still had a profit of $0.25 per share. Their stock continues to be in the double digits.

Hudson City Savings Bank's ratings for safety and soundness also indicate strong financials: 5 stars (superior) at BauerFinancial and 4 stars (sound) at These ratings are based on 9/30/08 financial data.

Hudson City Savings Bank is based in New Jersey with branches in New Jersey, New York and Connecticut. The bank has been FDIC insured since 1934 (FDIC Certificate # 13074).

Internet Money Market Savings Rate History:
03/19/10: 1.15% APY
??/??/10: 1.25% APY
12/05/09: 1.40% APY
11/14/09: 1.50% APY
10/17/09: 1.60% APY
07/18/09: 1.75% APY
07/11/09: 1.85% APY
??/??/09: 2.00% APY
02/11/09: 2.50% APY

  Tags: CD rates, Hudson City Savings Bank, savings account

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Comment #1 by Anonymous posted on
How depressing -- reporting sub-3% yields. Not shooting the messenger, Banking Guy, just venting.

Comment #2 by Sofa King Frustrated (anonymous) posted on
Sofa King Frustrated
Yeah, who would have thought that saying a 2.5% savings account is competitive?


And to make matters worse? Just wait for the day that Banking Guy has to say a 1.5% rate is competitive.

Nobody, and I mean nobody in a position of power cares that savers cannot make a decent rate at a government insured bank. (Nobody ever makes reference to this in public.) Why should they when they themselves are wealthy enough where the low savings interest rate doesn't really hurt them that much?

Comment #3 by Anonymous posted on
The lousy couple of thousand dollars interest, will put me in the next higher tax bracket.
I'll keep my money under my mattress and save on taxes more then the interest earned will pay me. Do the calculations and if you are on the boarder line of the next tax level, keep your money in non interest bearing account and you are effectively earning 5% by not paying inflated taxes.

Comment #4 by Anonymous posted on
Sofa King Frustrated,

I have been saying that for a long time.

I feel your pain as I am sure thousands of other savers do too.

Comment #5 by BankFiesta (anonymous) posted on
Good deal, submitted it to to share with others. Thanks!

Comment #6 by Anonymous posted on
To the poster at 11:34AM

Only the income over the "next" tax bracket will be taxed at that level.

All the income below the "next" tax bracket will still be taxed at the lower level.

Comment #7 by Anonymous posted on
Anonymous at 4:12pm,

You caught that too.
And even though a person may end up in a higher tax bracket, you still get to keep some of the interest earned with is better than putting it under your matress and getting no interest.

Comment #8 by Anonymous posted on
This bank was reported on ABC Nightline several weeks ago when they talked about the financial crisis and how this small bank avoided a lot of the subprime problems. The bank has been profitable for many decades since it mostly deals with local businesses and customers.

As for the comment regarding being pushed into the next higher tax bracket because of the extra money earned, you have to remember that the taxation rate is not across the board for all of your interest earned. It is based on income levels. If you reach a particular level, any additional money is taxed at the higher rate. All of the money up to that bracket rate is taxed at a lower rate(s). The fact you have any interest money to be taxed at a higher level rate is better than having no interest at all to be taxed at that level. You still get some net profit.

Comment #9 by Anonymous posted on
The stock price per share is now below the double digit price level. Financial stocks are being hammered now. Even though they raised the dividend payout, the market short sellers are calling the shots.

Comment #10 by Anonymous posted on
I'm surprised to see a "nationally available" Online Money Market Savings Account that actually allows the following: # Unlimited deposits and in-person withdrawals
# Bank by Mail deposits welcome
# Free features: Direct deposit, telephone & internet banking. It looks like it's very convenient for those who live near a Hudson City Savings Bank (in NJ, NY, CT). A somewhat competitive yield but with $2,500 minimum is good. Actually, i see that they have decent accounts for local residents, such as the Super NOW Checking account ($1,000 min to avoid fee, and to earn 1.24% apr) with debit/ATM card ($1 fee to use non-Hudson bank).