Hanmi Bank is offering some competitive rates on its Prime Installment Savings Account. The yields range from 4.34% APY for a 12-month term to 5.65% APY for a 60-month term. Below is the full list of rates as listed at the bank's Prime Installment Savings Page as of 5/05/09:
- 4.34% APY 12-month
- 4.34% APY 18-month
- 4.86% APY 24-month
- 4.86% APY 30-month
- 5.13% APY 36-month
- 5.39% APY 48-month
- 5.65% APY 60-month
The installment savings account requires that you make monthly deposits during the term. The deposits earn a guaranteed interest rate, and you'll receive the contract amount at maturity if you maintain the monthly deposits.
Some important features of Hanmi's Prime Installment Savings account include:
- The interest rate and APY in effect at account opening will be paid until maturity.
- The minimum contract amount is $1,000. The contract amount may increase in multiples of $1,000 with a maximum of $100,000 (updated 10/08/09)
- Interest will be compounded daily, and interest will be credited to your account quarterly.
- If you withdraw before term, a penalty of three months interest on the amount of the withdrawal will be imposed.
- If you do not withdraw after maturity, your account will be transferred to a Regular Savings Account.
Credit for this find goes to FW member krk77 who mentioned it in this FW thread.
Hanmi Bank's Internet CDs
Hanmi Bank had some excellent CD deals earlier this year. Currently, they have some fair deals on their internet CDs: 2.53% APY for 12 months and 2.28% APY for 9 months. These rates are listed in the bank's online accounts overview page as of 5/05/09. Even though you can apply online for these, you still must be a California resident.
Hanmi Bank is having a tough time in this financial crisis. The bank's holding company issued 1st quarter results which showed continued troubles. The CEO stated that "we continued to experience higher delinquency rates and an increase in non-performing loans as a result of the prolonged economic slowdown." It's interesting to note in the results the bank mentioned an increase in the total cost of average interest-bearing deposits. It stated that this "was due in large part to an aggressive promotion (commenced in December 2008 and concluded in early March 2009) of flexible time deposits with attractive rates." In January they were offering a 4.20% 6-month CD which allowed unlimited deposits during the term. It appears this did attract a large amount of deposits.
As you might expect, Hanmi Bank's ratings for safety and soundness are weak: 1 star (lowest) at Bankrate and 3 stars (adequate) at BauerFinancial. Both are based on 12/31/08 data. As I recommend with any bank, it's best to stay under the FDIC limits. The bank has been FDIC insured since 1982 (Certificate # 24170).
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 Account Page.
Edit 10/08/09: Updated maximum contract amount to $100K. There used to be no limit.