Dedicated to Deposits: Deals, Data, and Discussion

Update on Nara Bank and its CD and Installment Savings Account - CA, NY & NJ Only

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Update 4/15/09: The 3.10% APY appears to be over. The Mega Promo CD page no longer lists the rate. It has been reported that the rate is now 2.85% APY.

Even though Nara Bank ended the good online deals last week, they're still offering some very competitive branch-only deals. First, they're still listing the Mega Promo CD on the front page. When I first posted on this deal, they made it look like it would end on 3/27/09. But now this date is no longer shown. The CD has a 3.10% APY and a term of 12 months. Minimum deposit is $10,000, and new money is required. It allows unlimited deposits and up to 3 penalty free withdrawals before maturity. Additional deposits must be at least $1,000 per deposit. The 3 early withdrawals will only have the penalties waived if you maintain a balance at least 70% of the initial opening deposit. The official details and the rate are listed at the bank's promotions page (pdf) as of 3/30/09.

A reader emailed me an aspect of this Mega Promo CD that can be quite favorable to the customer. Here's what he described
Since the interest is accrued at maturity on the total sum in the account, a customer could add significant funds in the eleventh month and get the full annual rate on that new money. I'm not sure why Nara would choose to allow that, but again, the CSR said that is the way the CD functions.

Note, CSRs are not always 100% correct on all the account details. So take this with a grain of salt.

Installment Savings Account with Rates up to 5.65% APY

I posted on Nara Bank's Online Installment Savings Account on March 22nd. Apparently, there was a large demand, and they stopped offering the Online Installment Savings Account. In addition, they slashed the rates on the online CDs. However, they're still offering the Nara Happy Cow Kids Installment Savings Account. It's targeted for kids, but the reader mentioned that it's fully available to adults as well. This Kids Installment has the following rates and terms as listed in the bank's promotion page (pdf) as of 3/30/09:
  • 4.08% APY 48 months
  • 5.13% APY 60 months
  • 5.65% APY 84 months
Instead of making one initial deposit, you agree to monthly deposits. At maturity, the balance equals the sum of all the deposits plus the accrued interest. When you open the account, you specify the maturity balance (the contract goal amount). Minimum contract goal is $1,000. Based on that amount, you then make monthly deposits.

One example they give is a goal amount of $10,000 and a monthly payment of $192.43 for a 48-month term. Without earning any interest, the 48 payments would equal $9,236.64. Adding the interest earned from a 4.08% APY would add another $763.36 to make the maturity balance equal to $10,000.

For those looking to invest a lump sum, this installment savings account may not be useful. But if you have monthly income, it can be a useful way to save.

3.04% Checking Account

There's also a good deal on Nara Bank's interest checking account (Choice Now Checking). They don't seem to list the rates at the website, but the reader noted a 3.04% APY on balances of $10K or more. Minimum opening deposit is $500. That amount has to be maintained as a minimum at all times to avoid a $20 monthly service charge. This fee can also be waived if you have at least five ACH or ATM debits during the statement period.

Bank Locations and Financial Overview

Branches are located in Los Angeles and several other cities in Southern California. The bank also has branches in Northern California and in New York and New Jersey.

Nara Bank has some decent ratings for safety and soundness: 4 stars (sound) at Bankrate.com (based on 9/30/08 data) and 4 stars (excellent) at BauerFinancial (based on 12/31/08 data). The bank has been FDIC insured since 1989 (FDIC Certificate # 27530).

Thanks to the reader who emailed me news of these accounts.

  Tags: New York, California, CD rates, New Jersey, Nara Bank

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Comments
30 Comments.
Comment #1 by Anonymous posted on
Anonymous
I am getting a CD out tomorrow, looking for something like this, I may be able to open the account with sum like $1000 and add $99000 that means, I need to lave $700 min but withdraw the remaining in 3 free withdrawals :-)
Also that 11th month deposit also sounds cool
More salt to taste...

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Comment #2 by Anonymous posted on
Anonymous
I am the same above commenter..
It looks like minimum $10K to start, not $1K

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Comment #3 by Anonymous posted on
Anonymous
No way interest is accrued at the end of the term. Interest is accrued daily and PAID at the end of the term. Use some common sense here people.

What isn't clear is whether the money can be ACH'd in or whether you have to go to the branch and deposit it. To open the account requires a branch visit. They have no facility to initiate ACH xfers, and the 2-small-deposit link method may not work to establish a link from an outside institution - depostts would be too small, per the deposit agreement.

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Comment #4 by Anonymous posted on
Anonymous
Installment account still available, but with lower interest rates:

http://www.narabank.com/visionsavings.aspx

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Comment #5 by Anonymous posted on
Anonymous
I called today , only 2 branches in Northern CA. no ach and mre important no or little english very hard to understand . i put my money in GMAC . did not love the rate but could understand the csr . you would think they would hire an english speaking person .

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Comment #6 by Anonymous posted on
Anonymous
We opened the special 12-month CD last week and while assisting my parents open an account in the vesting of their Living Trust, the new accounts rep. kept asking another employee for help in Korean. I am not Korean and only speak English, so I was taken back a little. I think this Bank is OK, but a little respect would be helpful. We opened a $150K relationship, so maybe larger amounts do not matter to them one way or the other. I think we won't be opening accounts at Korean Banks in the future. If we had a problem, would they be able to understand the problem and assist us in resolving it? I am not sure.

My 2 cents worth.

OC Steve

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Comment #7 by Anonymous posted on
Anonymous
3.04% for a checking account is fabulous...and if this rate would hold, this would be a better choice than the Mega CD.

Of course, how long will the 3.04% Choice Checking Account rate stay 3.04%?

And why wouldn't this bank hire employees who speak better English?

1
Comment #8 by Bozo (anonymous) posted on
Bozo
To: All
Re: Nara Bank

Folks, I can tell you that if Alliant lowers the rate on its 1 year CD from 3.15% to 3% or below, I'm motoring over to Oakland with my CD money on April 22. In this rate environment, 3.10 APY is pretty nice. I also like the add-on feature.

Oh, and as for Korean, after you open the CD, there's only one Korean word you need to remember: kamsamida (kam-sa-mee-dah, accent on the last syllable). Means, "thank you."

Bozo

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Comment #9 by Anonymous posted on
Anonymous
Dear OC Steve,

Thanks for posting.

I hate banks that don't list their interest rates on their Website.

Did you, by any chance, confirm that Nara does indeed offer a 3.04% checking account? I couldn't even find "Choice Now Checking" on their site.

I guess I need to call them, but I am afraid with them speaking mostly Korean I won't be able to communicate what I want to know.

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Comment #10 by Anonymous posted on
Anonymous
Anonymous @ 5:56 PM is correct about the Mega CD interest computation: Simple interest at the rate of 3.10% based on 365 days/yr, APY = 3.10%. Accrued interest is not compounded ==> it earns 0% return and thus, might as well be paid out monthly to be used/reinvested somewhere else.

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Comment #11 by Anonymous posted on
Anonymous
To 10:48 on 3/30/09, you are correct the interest is simple interest. We elected to get a monthly interest check so we could put it in a money market account elsewhere and get a little "compound interest".

OC Steve

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Comment #12 by Anonymous posted on
Anonymous
I did phone one of the Nara branches this morning.

I was told their Choice Now Checking Account is not listed on their website (why the f*#k not?)

At least 5 times during the conversation the CSR voluntarily told me that the 3.04% rate can go down (as if it was a warning to me, or perhaps a way to get me to instead consider their CD, which she also voluntarily mentioned without me asking).

She confirmed that one must keep a minimum of $10,000 balance to get the 3.04% rate for the checking account. Apparently it is a regular checking account with no check writing restrictions.

Worth considering?

1
Comment #13 by Anonymous posted on
Anonymous
Just opened a $10K CD with the simple interest check mailed out monthly.
Pretty bad language issues with any single worker in the bank, I prefer not to bank with them without a deadly attraction.
I just opened to have a back up to stuff in my future money adding(if rates go down in the next 12 months).
So far so good.. bank is a couple of miles from my place but hate to go into that if not required :-)

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Comment #14 by Anonymous posted on
Anonymous
4/2/09: Added to the Mega CD, then checked CD account online: deposit/balance showed up correctly.
4/3/09: Yesterday's deposit disappeared, balance reverted to opening balance.
Awaiting bank's service manager explanation and rectification of problem...

1
Comment #15 by Anonymous posted on
Anonymous
On 3/25 (before the rate drop on 3/27 I opened installment savings account online, got confirmation number along with statement that a welcome package would be mailed in 2-3 business days, and to return the items requested within 10 days (giving the impression of a rate lock). It is now 4/6, and I still haven't received anything from them in the mail or by e-mail. I'm beginning to think that they might be deliberately delaying so as not to honor the original rate, or in hope that I'll just give up. It would have been a nice way of gradually building up savings at an attractive rate without depleting a large chunk of my more liquid accounts all at once. I'll post more when I can conclude whether or not Nara Bank is acting in good faith. I hope I'm just being paranoid.

1
Comment #16 by Anonymous posted on
Anonymous
Same as above -- but yesterday I finally got my 'package', which had an account number in it but nothing else useful. The account number could not be used to log onto the website, the CD amount was not mentioned, the deposit amount per month was also not mentioned. Forget these guys. No english, lame support, you just know there's going to be problems and they won't understand your lack of Korean and so what, they have your money, thank you very much. I threw the package out, in spite of the rate being 4%, it's just not worth the endless hassle.

1
Comment #17 by Anonymous posted on
Anonymous
Got a call today saying that the package was on its way and that they woule honor the original rate (4.08%).

1
Comment #18 by Anonymous posted on
Anonymous
Regarding the simple interest CD - if you deposited $97,000 and the FDIC took over the bank 11.5 months later then you would get back your original $97,000 because the interest would not have accrued until 12 months later. Maybe that's the scam.

1
Comment #19 by Anonymous posted on
Anonymous
Update from 11:42 PM, April 07, 2009: Got the new account package. Contacted customer service at 1-866-574-0393 with no language issues. They confirmed rate, amount, and term, but told me the account would not be active until initial deposit is received. Sent check with initial deposit. Hope everything goes well.

1
Comment #20 by Anonymous posted on
Anonymous
Update from 1:52 PM (4/6/09) -- gave up on Nara Bank today (still have not received welcome package,
16 days later!!!). Jumped on even better deal at Wilshire State Bank today. Besides, WSB's New Jersey branch is even closer than Nara's, just in case I ever need branch services.

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Comment #21 by Political news (anonymous) posted on
Political news
opened installment 1 year at wilshire going to transfer monthly from wilshire savings. will ladder installmanet savings if rates are good

1
Comment #22 by Anonymous posted on
Anonymous
Nara bank sucks, I don't even know how much my installment should be since we are not able to see the page. I passed it.

Feedback for Nara:
1) Too slow to response (14 days?)
2) Should give customs a copy of installment schedule
3) Should have some FAQ
4) Should improve communication skills

Wilshire State Bank seems much better. So far so good, and the rate is better! Thanks!

1
Comment #23 by Anonymous posted on
Anonymous
Update from 12:43 PM 4/10/09: Nara Bank's welcome package arrived today (21 days after applying online, and no email confirmation in the interim). Since I already opened accounts with Wilshire State Bank, I'm probably going to chuck Nara's welcome package. By the way, there is an important difference between Nara and WSB: in Nara's disclosures, a "branch-assisted" transaction will incur a $10 fee; WSB's branch services are free.

1
Comment #24 by Anonymous posted on
Anonymous
Called today, was informed the rate on the Mega Promo CD was dropped to 2.85% from 3.10%

1
Comment #25 by Anonymous posted on
Anonymous
What is the difference between compounded and maturity when you open a CD account?

1
Comment #26 by anonymous77 (anonymous) posted on
anonymous77
Many readers have commented about their experience with Nara Bank, and several aren't too happy. Two issues that seem prevalent: slow response and poor communication skills.This hasn't been my experience at all. Nara has been quite responsive. The CSR I dealt with when opening my account has excellent communication skills and has even emailed me concerning rate changes. Nara also seems quite interested in getting customer feedback, with a mind to improving its services.

1
Comment #27 by Anonymous posted on
Anonymous
Even better than listing the interest rates publicly, Nara Banks lists the CURRENT interest rate for the day on each account's activity page. It also updates daily how much interest has accumulated for the current month and how much has been paid out during the current year.

They're currently paying 2.00% on savings ($1000+ to avoid fees), and 2.25% on the Choice NOW checking (I think $500+ to avoid fees)

1
Comment #28 by Anonymous posted on
Anonymous
Arriving at the Nara Bank branch in NYC I was very happy with the service and also the very clearly explained monthly statement. As CD rates rise and I'm sure they will I will drive again 50 miles to deal with this bank. Anonymous

1
Comment #29 by Anonymous posted on
Anonymous
Funny to hear all the ****ers and moaners out there when this was one of the best deals around. If you got in on it, great for you and me. If not, gain your 1% at some other bank and have fun.

I can only speak of the NYC and Fort Lee, NJ branches but I don't speak Korean at all and everyone I spoke to had no problems speaking English.

I would stay away from Wilshire State Bank! Had an account there but had enough of rude customer service.

1
Comment #30 by Anonymous posted on
Anonymous
Please, up-date this site.

Aug.-17-2011

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