Bank Deals Weekly Summary for February 20, 2010

Leave a comment
Feb 20, 2010 - 6:58 PM by Ken Tumin

Hot Deals, Quick Link for Rates, Recap of this week's posts

One bit of good news for savers this week was the Fed's rate hike of the discount rate. This is not the Fed funds rate which is much more influential on consumer rates, but as this CNN commentary suggests "it may be time to salute the Fed for at least getting the rate hike wheels in motion."

The wheels may be in motion, but I'm afraid it might be a long road. On Thursday, the unexpected rise in the Producer Price Index made it look like inflation could force higher interest rates sooner than expected. However, the more important Consumer Price Index for January was released the next day, and inflation was lower than expected. Mish's Global Economic Trend blog describes why the CPI change was much more relevant to inflation than the change in the PPI.

Before yesterday we only had one bank failure in February, but that changed yesterday with four bank failures. The most significant closure was La Jolla Bank in California. The FDIC arranged for OneWest Bank to assume all deposits. This is the second sizable failed California bank that OneWest has acquired.

The other three banks that failed yesterday were small, but one bank of note was The La Coste National Bank in Texas near San Antonio. The interesting aspect of this bank was that it had a 5-star rating at BauerFinancial and a 3-star rating at Bankrate. This is highly unusual. The vast majority of banks that have failed over the last couple of years had the lowest ratings at both services. One important point about these rating services is that they depend on the quarterly FDIC data, and that latest data was released on 9/30/09. It's possible that this small bank was impacted with major issues that caused its health to nosedive in a very short time. Unfortunately, the OCC press release only had a general description of why it was forced to close the bank:

The OCC acted after finding that the bank had experienced substantial dissipation of assets and earnings due to unsafe and unsound practices. The OCC also found that the bank incurred losses that depleted its capital

Savings Account Rates

Incredible Bank reduced its checking account rate this week to 1.74% APY. It had been near the top of the liquid account list for over 3 months with a 2.02% APY. There were quite a few disappointments this week. Two former rate leaders, FNBO Direct and CNB Bank Direct, cut their rates this week putting them below average. Ally and Colorado Federal Savings Bank both cut their rates for the second time in the last two weeks.

On a positive note, I reported on two new savings accounts this week that both have very competitive rates. Southern Community Bank and Trust has an internet bank called Ready Saver that offers an online savings account that pays 2.00% APY on all balances (see review). The Palladian PrivateBank's savings account is not quite this good, but it's still competitive with a 1.70% APY (see review).

Rate Hikes:

  1. Ready Saver - 2.00% (newly reported)
  2. Palladian PrivateBank - 1.70% (newly reported)

Rate Cuts:

  1. Incredible Bank Checking - 1.74% (was 2.02%)
  2. Colorado Federal Savings Bank Savings - 1.40% (was 1.50%)
  3. CNB Bank Direct Savings - 1.35% (was 1.50%)
  4. Ally Bank Savings & MMA - 1.39% (was 1.44%)
  5. Bank of American Fork Savings - 1.30% (was 1.35%)
  6. WTDirect Savings - 1.26% (was 1.41%)
  7. AIG Bank MMA - 1.26% $10K (was 1.30%)
  8. FNBO Direct Savings - 1.25% (was 1.40%)
  9. ING Direct Savings - 1.15% (was 1.20%)
  10. Intervest National Bank MMA - 1.13% $2.5K (was 1.15%)

Certificate of Deposit Rates

America's Credit Union is no longer offering its special 7-month and 13-month CDs. Its 7-month CD had been at the top of the list. Another credit union that I removed from the short-term CD lists is Wings Credit Union. According to Wings' rate table, the 3-, 6- and 12-month CDs are for "existing certificate renewals only". This isn't a major loss since Wings has a membership primarily limited to those in the air transportation industry.

With the loss of the above CDs, there's not much choice for decent short-term CD rates. Short-term CD rates are so low that I don't see the benefit of these over savings accounts. For example, the highest rate for a 6-month CD in the list below is 1.62% APY. There are several savings accounts with rates over this. These savings account rates may fall in the next 6 months, but even if they do fall, it's unlikely you'll lose out much in only 6 months.

You can get higher rates with long-term CDs, but I understand the worries people have about rising interest rates over the next couple of years. Unfortunately, no one knows how long it'll take before we start to see higher rates. I came across a June 2008 comment in which the reader said he saw no reason to get 4.00% CDs since he thought rates would not be going down. That seemed reasonable in June 2008, but as we've seen, rates did fall substantially. This is one reason CD ladders can be useful. You don't have to guess about future rates.

The risk of long-term CDs can be minimized if the CDs have reasonable early withdrawal penalties. If rates do shoot up, you can break the CD without too much of a loss. However, there are questions about the possibility that the bank could refuse an early withdrawal or make other changes in the account disclosure before the CD matures. This issue has recently come up when Darby Direct informed its customers that it had changed the account disclosure of existing 36-month Step-Up CDs that would prohibit additional deposits after February (see post).

Below are some of the best nationwide and local CD deals that are still active.

Best Nationwide CD Deals as of 2/20/10: Also listed are savings account promos with rate guarantee periods. The full list of nationwide CD rates is farther down.

  1. 2.25% 3-mo money market/checking promo at EverBank (account review)
  2. 1.77% 10-mo CD at EBSB Direct (account review)
  3. 2.10% 12-mo CD at Alliant CU (account review)
  4. 2.00% 14-mo CD at Digital CU (account review)
  5. 2.25% 15-mo CD at First City Bank (account review)
  6. 2.00% 15-mo CD at Country Bank for Savings (account review)
  7. 2.30% 21-mo CD at Stonebridge Bank (account review)
  8. 2.02% 24-mo Add-On CD at Northwest FCU (account review)
  9. 2.75% IRA-only 30-mo CD at Navy FCU - Limited Membership (account review)
  10. 3.00% 36-mo CD at Pentagon FCU (may change in Feb) (account review)
  11. 3.25% 48-mo CD at Pentagon FCU (may change in Feb) (account review)
  12. 3.15% 48-mo CD at Hudson City Savings Bank (account review)
  13. 3.65% 60-mo CD at Melrose CU (account review)
  14. 3.60% 60-mo CD at Apple FCU (account review)
  15. 3.55% 60-mo CD at iGObanking (account review)
  16. 3.50% 60-mo CD at Pentagon FCU (may change in Feb) (account review)
  17. 3.40% 60-mo CD at Hudson City Savings Bank (account review)
  18. 3.15% 60-mo Small-Penalty CD at Ally Bank (account review)
  19. 4.25% IRA-only 84-mo CD at Navy FCU - Limited Membership (account review)
  20. 4.06% 84-mo CD (min $175K) at USAA Bank (account review)

Best Local CD Deals as of 2/20/10: Some of the best CD deals are from banks and credit unions that don't offer accounts nationwide. Refer to the recap section and the state index section to find all the recent local deals. Here are some of the best deals to note.

  1. 2.30% Money Market Account (min $100K) at Georgia Primary Bank in Atlanta (account review)
  2. 2.02% Money Market Account at South Florida FCU (account review)
  3. 2.00% 6-mo CD at Vision Bank in Dallas (account review)
  4. 2.00% 6-mo CD at United Financial Bank of Florida (account review)
  5. 2.25% 12-mo CD at Workmen's Circle CU in Georgia (account review)
  6. 2.22% 12-mo CD at Cornerstone Bank & Trust in IL (account review)
  7. 2.06% 12-mo CD w/chk at Chartway FCU in VA, GA, RI, NC, TX, FL & NJ (account review)
  8. 2.00% 12-mo CD at Premier American Bank, NA in Miami, FL (account review)
  9. 2.01% 15-mo CD at Aspire FCU in NY, NJ, NH & VA (account review)
  10. 2.20% 16-mo Jumbo CD at Teachers FCU in NY (account review)
  11. 2.18% 18-mo CD w/chk at Greater Western Bank in AZ, CO, KS, NE, SD, IA & MO (account review)
  12. 2.20% 18-mo CD & 3.20% 44-mo CD at Crescent Bank & Trust in Louisiana (account review)
  13. 3.00% 24-mo CD at LOMTO FCU in NYC (account review)
  14. 3.00% 26-mo/49-mo CD Combo at SunTrust Bank in FL (account review)
  15. 3.35% 48-mo CD at Fidelity Bank of FL (account review)
  16. 4.00% 60-mo CD at PFFCU in Philadelphia (account review)
  17. 3.60% 60-mo Jumbo CD at CEFCU in CA & IL (account review)
  18. 3.56% 72-mo CD at Broadway Federal Bank in Los Angeles (account review)
  19. 4.25% 10-year Flex-CD at First Choice CU in Florida (account review)

Reward Checking Accounts

I reported on three new reward checking accounts this week with yields from 2% to 3.55% APY. The 2% APY is low for reward checking, but it's good for balances up to $500K. This account is being offered by Republic Bank and is available in parts of OH, KY, IN and FL. It's getting harder to find reward checking accounts with large balance caps. The other reward checking account that I reported on this week is offering 2.75% APY on balances up to $250K, but just two days after my post, a reader reported being notified by the bank that the rate is being slashed in March.

To find reward checking accounts with large balance caps, refer to the reward checking section of DepositAccounts. At the top of the table, click twice on the Max title. This will sort the table based on the balance cap. The N/A indicates that there is no maximum balance and the entire balance can qualify for the top rate.

If you just want the highest rate from a reward checking account, you can still get around 4% APY on balances up to $25K for nationwide reward checking accounts. I reviewed a few of these that have maintained competitive rates for over two years in this Monday post. Unfortunately, a couple of them have lowered their balance caps below $25K. This can be as bad as lowering the rate.

To see all of the high yield reward checking accounts available throughout the nation, please refer to the reward checking section of DepositAccounts.com.

Don't Forget to Check the Notices Section

As I mentioned before, lots of my posts are now in the Notices Section. Notices are very short posts that are intended to alert you to rate changes or point you to some interesting banking news or deals on the web. This allows me to post more often on news and deals. I'll continue the blog posts in the same format that you're used to. You can get to the Notices Section from the top menu. You can also see the recent Notices on the front page. Just select the Notices tab which is next to the Blog Posts tab. If you want to subscribe to both blog posts and Notices, just click on the RSS icon at the top of either the Blog or Notices section.

Recap for the Week - Links to This Week's Posts

Banking News

CD Deals - National

Savings/Checking Accounts - Nationwide

Checking/Savings Bonuses

Reward Checking Accounts

CD and Money Market Deals - Local

The rates listed below are based on Annual Percentage Yield (APY). No minimum balances are required unless noted. MMA next to the rates indicate a money market account. Most MMAs have check writing and ATM cards. Online savings accounts usually lack both of these. The top lists include banks and credit unions with broad availability and with minimums under $100,000. Previous weekly summaries are available at this page. Quick Links: Refer to the following links for the savings accounts and CDs that interest you: Liquid Account Rates: Savings Accounts, Reward Checking, Bank alternatives CD Rates: 3 Mo CDs, 6 Mo CDs, 9 Mo CDs, 12 Mo CDs, 18 Mo CDs, 24 Mo CDs, 36 Mo CDs, 48 Mo CDs, 60 Mo CDs, 84 Mo CDs, CDs by state Comments: read and discuss

As of February 20, 2010

Checking/Savings/Money Market Accounts:

  • Noteworthy Accounts Available Nationwide:

3-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:

6-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:

9-Month Certificates of Deposit:

12-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:

18-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:



24-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:

36-Month Certificate of Deposit:

  • Noteworthy Accounts Available Nationwide:

48-Month Certificate of Deposit:

  • Noteworthy Accounts Available Nationwide:

60-Month Certificate of Deposit:

  • Noteworthy Accounts Available Nationwide:

84-Month Certificate of Deposit:

Various Deposit Account Deals



High Yield Reward Checking Accounts - Open to All



Recent CD Specials at Local Credit Unions and Banks

Bank Account Alternatives

Historical Rates from the Federal Reserve (Federal funds, Treasury bills, CD's)

Edit 2/22/2010: Citi's 18mo secured MasterCard CD is now limited to just $5K (down from $25K)


Post a CommentComments
In order of date posted. - Sort by votes

Be the First to Comment


Post a Comment

Featured Savings Account
Nationwide Savings Accounts
Related Posts
Best Bank Account Interest Rates - Summary for Week Ending February 11, 2012Best Bank Account Interest Rates - Summary for Week Ending February 11, 2012
Best Bank Account Interest Rates - Summary for Week Ending February 4, 2012Best Bank Account Interest Rates - Summary for Week Ending February 4, 2012
Best Bank Account Interest Rates - Summary for Week Ending January 28, 2012Best Bank Account Interest Rates - Summary for Week Ending January 28, 2012
Best Bank Account Interest Rates - Summary for Week Ending January 21, 2012Best Bank Account Interest Rates - Summary for Week Ending January 21, 2012
Best Bank Account Interest Rates - Summary for Week Ending January 14, 2012Best Bank Account Interest Rates - Summary for Week Ending January 14, 2012
Best Bank Account Interest Rates - Summary for Week Ending January 7, 2012Best Bank Account Interest Rates - Summary for Week Ending January 7, 2012
Best Bank Account Interest Rates - Summary for Week Ending December 31, 2011Best Bank Account Interest Rates - Summary for Week Ending December 31, 2011
Best Bank Account Interest Rates - Summary for Week Ending December 24, 2011Best Bank Account Interest Rates - Summary for Week Ending December 24, 2011
Useful Resources