Dedicated to Deposits: Deals, Data, and Discussion

Competitive Long-Term CD & Savings Account Available Online at River Bank - MA & NH Only

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River Bank is offering a competitive 5-year CD yield of 3.51% APY. The shorter terms are not quite as competitive. The ones that are a little above average include the 1.70% APY 15-month CD and the 1.40% APY 9-month CD. An extra 0.10% is available for money market or checking account customers. These are also available as IRA CDs. Minimum deposit is $500. These rates are listed in the bank's deposit rates page as of 2/18/2010.

River Bank also offers a competitive savings account called xStream Savings which has a 1.45% APY with no minimum balance requirements. It does require a minimum $40 automatic monthly transfer. This rate is listed in the bank's savings rates page as of 2/18/2010.

There's an online application, however, the second page form only allows residents of Massachusetts and New Hampshire to apply. It appears funding can be done by an ACH transfer. Under the CD rates table, the following is stated regarding when the CD rate locks:

The CD interest rate is guaranteed for five business days following the date of internet application. If we do not receive your deposit within this period, the interest rate will be the rate in effect on the day the deposit is received.

The bank is headquartered in North Andover, Massachusetts. In addition to North Andover, branches are located in Andover, Lawrence and Methuen, MA and in Salem and Derry, NH.

The bank's ratings for safety and soundness are strong: 5 stars (superior) at BauerFinancial and 4 stars (sound) at Bankrate.com. Both ratings are based on 9/30/09 financial data. The bank has been a FDIC member since 1981 (FDIC Certificate # 23288).

  Tags: CD rates, savings account, Massachusetts, New Hampshire

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Comments
2 comments.
Comment #1 by Anonymous posted on
Anonymous
Wholesale inflation for January 2010 was 1.8% more than 16% annually!!!

Don't lock anything for more than a few months unless the bank has no rule that allows it to deny early withdrawal!! IMHO next year same time we will double digit inflation and CD rates.

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Comment #2 by Steve (anonymous) posted on
Steve
Obviously inflation will not be 16% any time soon. 

If you have the luxury of being able to invest for 5 or more years, going short term on a CD is not necessarily in your best interest, even in a rising interest rate environment.  Take a look; today, if you invested $10,000 in a 5year CD at 3.51% apy, at the end of 5 years you would have approximately $11,915.  As an alternative, if you think rates are going to rise and you choose to stay shorter term initially, your $10,000 invested for 15 months at 1.70% apy would provide you with approximately $10,215 at the end of the first 15 months.  That would mean you would have to earn a rate of 4.19% for the remaining 45 months to have the same $11,915 that you would earn if you originally went with the 5 year CD.

Your decision becomes two-fold.  (1) do you have the ability to tie your money up for 5 years, and (2) do you think rates will rise enough in 15 months for you to earn 4.19% apy or more for the next 45 months (that's less than a 4 year CD).

There's no right answer, it just depends on your individual circumstances and how fast you believe interest rates will rise.

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