Dedicated to Deposits: Deals, Data, and Discussion

High Yield Installment Savings Accounts at NewBank in NY & NJ - Local Only


Another Korean American bank, NewBank, is offering high rates on installment savings accounts. Below is a summary of the three types of installment savings accounts being offered with the rates as of 4/24/09:
  • Christmas / Vacation Club Account: 6.50% APY, 168-day term, $5K maximum contract amount
  • Installment Club Savings: 4.60% APY, 12- to 36-month term, $25K maximum contract amount
  • Education Club Savings: 5.50%, 6.50%, 7.00% APY for terms of 5, 10, 15 years, $100K maximum contract amount
These rates don't seem to be listed at the bank's website. Credit for this find goes to FW member mh83 who posted details and the scan of the rates at this FW thread. Also thanks to the Bank Deals reader who mentioned this in the comments. Refer to the FW thread for more details. Some important points mentioned include: Christmas Club Account requires bi-weekly auto-transfers from other NewBank account, customers can open accounts for any purposes, allowed to open as many accounts as you want, branch visit is required to open an account.

Installment savings accounts require equal monthly deposits from the bank's checking account to the savings account. Like a CD, the rate is fixed during the term. Also like a CD, there is an early withdrawal penalty. If you open one of these, it's best if you can set up automatic transfers from a high yield savings account. You would want to make sure you maximize the interest of the money before the transfers are made into the installment savings account. If you have too much sitting in a checking account before the money is transferred, you'll lose out on the interest.

NewBank branches are located at Flushing, New York and Fort Lee, New Jersey.

The bank has strong ratings for safety and soundness: 5 stars (superior) at BauerFinancial and 4 stars (sound) at Bankrate. Both ratings are based on 12/31/08 financial data. The bank was recently established in 2006. It's a member FDIC (FDIC Certificate # 58203).

Other Installment Savings Accounts

These installment savings accounts seem to be popular among Korean American banks. In the last couple of months, I've posted on several with high rates. Similar to NewBank, most are located around California and New York and require a branch visit. However, Wilshire State Bank is offering one that is available nationwide via an online application. It has rates up to 5.12% APY for a contract term of 3 years (see post). To find other installment savings accounts, refer to my Installment Savings Accoung Page.

  Tags: New York, NewBank, New Jersey

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