It appears to be another example of a bank being overwhelmed with deposits. On Friday readers noticed that Tennessee Commerce Bank had removed the TCB Savings Account from its rate table. I also noticed that the TCB Savings Account was no longer an option in the online application. I just called this morning, and I received confirmation that they are no longer opening new TCB Savings Accounts. They made this change last Thursday. However, I was told there are no changes for existing customers. The account will continue to pay 2.30% APY on balances up to $100,000. According to the CSR, they have no immediate plans to change this account for existing customers and if they do decide to cut rates or make other changes, they'll provide 30 days written notice before the change.
The TCB Savings Account's 2.30% APY was the highest non-promo rate for nationally available savings accounts. Top savings accounts haven't held up well this year. SFGI Direct had been offering a 2.25% APY internet savings account, but this lasted less than a month before the bank suspended new account applications (see post). Other examples this year of internet banks reducing availability of their high-yield savings accounts include Darby Direct and Clear Sky Accounts. There have been many more examples for reward checking accounts.
This shows the demand that must exist for decent interest rates on liquid accounts. It also shows the advantage of jumping on these deals early. In most cases the banks that reduced availability continued to offer very competitive rates.
Other Competitive Savings Accounts