Update on Hanmi Bank in California - Deposit Deals and Financial Condition
Nov 11, 2009 - 4:06 PM by Ken Tumin
By July 31, 2010, the Bank will be required to increase its contributed equity capital by not less than an additional $100 million.
This LA Times article has more discussion on Hanmi and its plans to raise new capital.
If you stay below the FDIC limit, you shouldn't have to worry about losing money. The main concern would be if a new bank that takes over after Hanmi's closure would honor existing CD rates. If they don't, you would be free to take an early withdrawal without a penalty.
Installment Savings Account
If you don't mind the above risk, Hanmi Bank does continue to have some good deposit deals for those in California. The best is their Prime Installment Savings Account which continues to offer very competitive rates. As of 11/11/2009, Hanmi lists rates ranging from 4.34% APY for a 12-month term to 5.65% APY for a 5-year term, and readers have reported an extra 25 basis points when you have auto transfer.
Installment savings account rates should not be directly compared to CD rates or regular savings account rates. 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. I have more details about Hanmi's installment savings account in this previous post. I have details about how you can compare installment savings account with CDs in this post. A quick way to come up with a rough idea of how an installment account compares to a CD is to take the average of the installment account rate and the rate of a liquid account. The initial lump sum would go into this liquid account, and the monthly deposits would be transferred from this to the installment account. Here's an example:
1.00% APY in the liquid account (assumes 1% will be the average rate of liquid account during the term of the installment account)
4.60% APY in the 1-year installment account (assumes 0.25% bonus for auto transfer)
Estimate for combined APY = (1.00% + 4.60%)/2 = 2.80% APY
Internet CD Rates
In addition to installment savings account, Hanmi Bank continues to offer some decent deals on its internet CDs. The two most competitive ones as listed at Hanmi's internet products page include a 2.02% APY 12-month CD and a 1.87% APY 9-month CD as of 11/11/2009. These can be opened online, but you have to be a California resident.
Checking Account Bonus
There's also a checking account promotion in which you can earn up to $70 with direct deposit and by making online bill payments.
Hanmi Bank has been a FDIC member since 1982 (FDIC Certificate # 24170).
Other Installment Savings Accounts
To find other installment savings accounts, refer to my Installment Savings Account Page. Be sure to check with the bank for the latest rates. If you've found any other bank offering an installment savings account, please leave a comment.
Banks Mentioned in this Post:
| Hanmi Bank Locations: 27 Health Rating:  |   |
| Recent Posts: Review of the Largest Banks Offering R... | 2.81% 6-Month CD & 2.60% 12-Month CD a... | |
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Anonymous - #1, Wednesday, November 11, 2009 - 6:13 PM
Looks like Hanmi needs a bailout. Some of that money going to all of the other online banks need to be redirected to Hanmi.
Anonymous - #2, Wednesday, November 11, 2009 - 7:42 PM
Why go through all the hassle only to wait for the FDIC to move in and another bank to take over? Sounds like a waste of time.
Anonymous - #3, Wednesday, November 11, 2009 - 7:47 PM
I was going open an account with Hamni last summer as they had some good internet rates. The problem I ran across was the phone customer service agents were hard to reach, hard to understand and could not answer simple questions. I live near a branch and stopped by to if they could assist me with some of the questions I had about one of the accounts. I notice when I was at their office that it appeared that they could care less if I opened an account with them, (not friendly). Finally one of the agents ask me what I needed. I told her that I was looking at one of Hamni’s savings accounts that was on the internet. As soon as she heard the word internet, her conversation was over with me. She stated that the Hamni branch offices don’t deal with these accounts. After losing 2 to 3 hours trying to find out some information on the account, I gave up. As I left I had this gut feeling that I had just dodged a bullet and was glad that I was not tangled up with these guys.
Anonymous - #4, Wednesday, November 11, 2009 - 8:12 PM
Something also to remember is that when banks are seized and sold to another institution you regularly will lose the interest payment on CDs and high yield deposit accounts. You initial deposit will be safe if under the FDIC limits but your interest is not usually covered and paid out by the Fed or the acquiring institution.
Anonymous - #5, Wednesday, November 11, 2009 - 8:40 PM
Anonymous @ 6:12 -
Nope. The TOTAL amount of deposits (principal + interest), that has accrued up until the day of the bank failure, is completely insured.
http://www.fdic.gov/consumers/banking/facts/index.html
Anonymous - #6, Wednesday, November 11, 2009 - 11:17 PM
they were a little slow in Irvine office when I opened up an installment account in last May. The rate was great and there was no max limit. Till July 2010, about 9 more months are left.
btw, the interest earned is also insured.
Anonymous - #7, Thursday, November 12, 2009 - 11:24 AM
I have opened several accounts at their office in Santa Clara. They are very helpful and friendly and easy to do business with. The most informed person at this branch handles all new accounts. If you deal with her you will be satisfied.
Anonymous - #8, Thursday, November 12, 2009 - 4:07 PM
So far so good at SF near Japanese Town. Thanks!
Anonymous - #9, Wednesday, December 9, 2009 - 12:21 PM
Rates went down. 3.77% for 12 month now.
Anonymous - #10, Thursday, December 17, 2009 - 3:04 AM
They are going down. The writing is on the wall. This bank is a joke as they are clueless as what is about to happen to them.
Anonymous - #11, Tuesday, December 29, 2009 - 11:21 AM
Rates now 3.50% for 12 month. Of course when I opened an account their website still said 3.70%, and the worker even brought it up on her screen. But they changed the rate that day, and now it shows correctly. They aren't that friendly to non-Koreans. Hate to say it, but true.
Quovatis - #12, Thursday, April 8, 2010 - 4:56 PM
All info on the installment savings seems to be gone on the website. The link is there, but nothing loads.
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