It has been almost a year since I first reported on Bank of the Sierra and its reward checking account. It's one of the very few banks that have not cut the rate or reduced availability this year. The top rate continues to be 4.51% APY for balances up to $25,000. Also, they continue to accept applicants nationwide. This puts them on top of the nationwide reward checking list for the best rate.
In my Bank of the Sierra review a few readers have reported being rejected by the online application. One reader thought he had been approved and saw his initial deposit deducted instantly from his current account. He found out later that he had been rejected. Note, it's best to open these accounts with the minimum initial deposit. If you do get rejected, you won't have to worry about losing interest while waiting to get back the money.
The last couple of readers have reported success in opening the account. Here's one commenter's review from November 25th:
I was accepted when I applied Nov. 4th and deposited 15k into Sierra. I received an email with a phone number asking me to verify my mother's maiden name (it was cc'd to 2 other people at the bank). It took three weeks to receive my card and pin, but when I phoned they are very nice and helpful - they knew who I was, what a pleasant surprise. Told me they have been swamped. Are giving me the 4.51% rate for the month even without my asking. I'm impressed with the customer service.
One thing a little worrisome is that the bank rep mentioned being swamped. As with any bank, once they bring in enough deposits, they will either lower rates or reduce availability. Hopefully, we still have some time before this happens.
Bank of the Sierra isn't a small bank. It has 24 offices in California with over $1 billion in assets and deposits. That should help it from being too overwhelmed by new reward checking customers.
We shouldn't have to worry about the FDIC forcing rate cuts. Bank of the Sierra appears to be financially healthy. Its ratings for safety and soundness are fair: 3 stars (performing) at Bankrate.com and 3½ stars (good) at BauerFinancial. Both ratings are based on 6/30/09 financial data.
Have you opened an account at Bank of the Sierra? If you have, please leave a comment about your experience.