As I mentioned last January, the bank that has been holding SmartyPig deposits, West Bank, reported that it was planning to transition SmartyPig deposits to a larger bank. SmartyPig made the announcement this morning that the new bank will be BBVA Compass. Here are excerpts of the press release:
BBVA Compass and SmartyPig today announced a strategic alliance where BBVA Compass will serve as depository institution to SmartyPig’s customers in the United States and work with SmartyPig to expand their shared customer base.
“BBVA Compass is an important choice for us as it was one of the few banks able to handle the scale of SmartyPig’s considerable growth while quickly and seamlessly integrating our current customers,” said Bob Weinschenk, chief executive officer, SmartyPig. “In addition, the superior global brand recognition of the BBVA name is important given our ambitions for accessing the global markets. This strategic alliance also provides SmartyPig customers access to BBVA Compass’ broad array of innovative banking products and services.”
SmartyPig customers will receive notice today, June 7, via e-mail allowing them to choose whether to continue their SmartyPig accounts with BBVA Compass as their new bank. Customers who continue their SmartyPig accounts will authorize the transfer of their funds on deposit at West Bank to their new BBVA Compass savings account effective as of August 1, 2010.
The SmartyPig co-founder, Mike Ferrari, provided more info in the SmartyPig blog about how this change will affect SmartyPig customers. Here's an excerpt from his blog post:
On August 1, 2010, with your permission, SmartyPig and West Bank will securely transfer your customer data and funds on deposit in your SmartyPig savings account from West Bank, our current bank services provider, to BBVA Compass. In order to keep your SmartyPig account active and your savings goals current, you must log into your account and authorize this transfer of funds and the opening of a BBVA Compass savings account. Please note that your funds will remain FDIC insured at all times to the fullest extent provided by law.
I don't see any indications how this may affect future interest rates. I would guess the negotiations with BBVA Compass had been taking place for the last several months and might have been part of the reason for last month's rate tier changes. If that's the case, perhaps the current rates will last for a while.
For those not familiar with SmartyPig, its savings account currently pays 2.15% APY on balances up to $50K. It's not a typical type of savings account. I have more details about SmartyPig in this December review. To see all of my previous posts on SmartyPig, please refer to our SmartyPig rates and reviews page.