Dedicated to Deposits: Deals, Data, and Discussion

Bank Deals Weekly Summary for July 3, 2010

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Happy Fourth of July! I hope the Fourth of July will be more enjoyable for you than reviewing our interest rate environment. June's unemployment report was released Friday. The good news is that the numbers don't point to a double dip recession. However, it appears job growth is going to be slow, and the Fed won't be in any rush to hike rates. The chance of a Fed rate hike before the end of the year continues to drop. The Fed funds futures are now showing the implied probability of a higher Fed funds target rate by December at 12.9% which is down from last Saturday when it was 16.8%

If you're waiting for the $250K deposit insurance limit to be made permanent, you're going to have to wait some more. This provision is in the current financial reform bill which passed the House this week, but it didn't make it through the Senate. It looks like the Senate vote won't occur until mid-July.

It appears the FDIC started the holiday weekend early. There were no bank failures on Friday. We saw a total of 86 bank failures in this first half of 2010. Last year at this time we were at 52. The NCUA was more active this week with the liquidation of one credit union which brings the total number of credit union liquidations this year to 10.

Discussion Forum Sweepstakes

On June 16th, we at DepositAccounts.com began a sweepstakes to encourage more participation in our new discussion forum. You can win up to $250 by just posting reviews in our Bank and Credit Union Reviews forum. July 15th is the last day to enter. Please refer to the announcement post for the full details.

Savings Account Rates

Three of the banks on the top savings account list reduced rates this week. For savings accounts without balance restrictions, the top rates are currently around 1.50% APY. You can still get around 2.00% at SmartyPig, AmericaNet and Evantage Bank. However all three have balance caps.

Rate Hikes:

  1. None

Rate Cuts:

  1. Bank of the Sierra Reward Checking - 3.09% (was 4.09%)
  2. Peoples Bank Savings - 1.30% (was 1.45%)
  3. Newtown Savings Bank - 1.30% (was 1.40%)
  4. Nationwide Bank MMA - 1.20% (was 1.25%)

Certificate of Deposit Rates

Many banks and credit unions reduced their CD rates this week. We lost two 1-year CD rate leaders. Incredible Bank stopped offering its 2% 12-month internet CD, and First City Bank cut its 12-month CD rate from 1.80% to 1.50% APY. Melrose Credit Union now has the best 1-year CD rate of 1.76% APY which is closely followed by Alliant Credit Union with a 1.75% APY for its Jumbo CD which requires a minimum $25K.

Most of the rate cuts came from the long-term CDs. There were several 5-year CDs with rates that fell below 3.00% this week. The best 5-year CD continues to be at Melrose Credit Union which has a 3.29% APY. The best deal in my opinion continues to be at Ally Bank. Its 5-year CD rate isn't great at 2.94% APY, but the big benefit is that it only has a 60-day interest early withdrawal penalty. As I described yesterday, this has many advantages.

4.00% 5-Year CD Available Nationwide?

There is one institution that is still offering a 4.00% APY 5-year CD. It's being offered at the Police and Fire Federal Credit Union (PFFCU) in Philadelphia. A reader commented that anyone can qualify for membership by joining an association that's open to all. Several readers have been successful in joining the credit union. However, there are reports that the credit union may change their policies regarding this association (see post).

There are some credit unions that have been enthusiastic about attracting members from outside their original market area. They clearly specify the organizations that can be joined to allow persons to qualify for membership. These credit unions include PenFed, Alliant and Northwest. However, there are some credit unions that have not been enthusiastic about new members from outside their market area. PFFCU might be an example of this.

I have two examples of how credit unions can make it difficult for out-of-state people to join even when they have easy-to-join associations in their fields of membership. One is Golden Plains Credit Union in Kansas. For a little while, people from outside of Kansas could join Golden Plains via an association and open its 6.01% reward checking account (it's still at 6.01%!). However, Golden Plains limited their reward checking account to only members who are Kansas residents.

MidWest America Federal Credit Union is another example. For a while people were able to join MidWest America via an association and open its 7.01% reward checking account (rate has fallen). The credit union changed the eligibility to require not only the association membership but also to require that you live within a certain distance from one of their branches.

PFFCU is a sizable credit union with over $3 billion in assets. So there's no reason why they can't follow Alliant and Penfed in accepting out-of-market applicants who qualify. Hopefully, PFFCU won't add barriers to membership or to opening their high-yield accounts like Golden Plains and MidWest America did. We'll have to keep an eye on PFFCU. If you applied at PFFCU, please leave a comment about how it went.

Reward Checking Accounts

I only reported on one new reward checking account this week. It's a reward checking account available at River Region Credit Union in Missouri. It has a 4.00% APY on balances up to $20K. I also did an updated review of a bank that's one of the few that are still offering 5% APY on balances up to $25K. Its name is Southern Bank, and it has branches in Arkansas and Missouri. I first reported on its 5% account in June 2009.

I wish more institutions were able to keep rates and balance caps high like Southern Bank. I reviewed one in Austin Texas that made some unfortunate changes. United Heritage Credit Union launched its reward checking account in mid 2007 with a 6.01% APY on balances up to $25K. Like many reward checking accounts, the rate has fallen. It's now 3.01% APY. In addition to cutting rates, it also stopped offering new accounts in early 2009. The nice thing about United Heritage is that it kept the 3.01% APY on balances up to $25K for existing account holders. The credit union recently started to allow new accounts again. However, those new accounts will only earn 3.01% APY on balances up to $10K.

To find both reward checking accounts local to you and those available nationwide, please refer to the reward checking section of DepositAccounts.com.

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

Banking News/Resources

Savings/Checking Accounts - Nationwide

CD Deals - National

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. 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 July 3, 2010

Checking/Savings/Money Market Accounts:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

3-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

6-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

9-Month Certificates of Deposit:

  • Noteworthy Accounts - Local Only

12-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

18-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

24-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

36-Month Certificate of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

48-Month Certificate of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

60-Month Certificate of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

84-Month Certificate of Deposit:

  • Noteworthy Accounts - Local Only

Various Deposit Account Deals

Bank Account Alternatives

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


Related Posts

Comments
8 comments.
Comment #2 by KenBDG posted on
KenBDG
Thanks for the link. It has a good explanation of why they implemented the $50K cap.

I've posted on this article in this forum thread.

2
Comment #3 by Donald (anonymous) posted on
Donald
ING Direct now offers 1.25% for a one year CD.  I think it was previously 1%.  Why didn't they announce this while they were promoting their 4th of July special?

2
Comment #4 by GaelicWench (anonymous) posted on
GaelicWench
Cactus, thanks for posting that link. It was quite informative. Although I had heard about Kasasa, SP and GreenDot, I didn't for the SimpleBank one; but I did learn a few new things on all as well, thanks to Ken for having posted those in the forum.

For those of you who post regularly and to Ken, hope you are all having a truly nice and SAFE 4th of July. There will be no fireworks here due to budget cuts.  :-(  Makes me wish I was back in Illinois to enjoy the fireworks over the Gateway Arch which are launched from a barge on the Big Muddy. Those have been amongst the group of spectacular fireworks displays in the U.S.

Until next time....

0
Comment #5 by Across the pond (anonymous) posted on
Across the pond
happy 4th jogw

-4
Comment #6 by Maecl posted on
Maecl
I don't know where to leave rate change or any other comment.   I don't like the new system.  It was so much easier before.

Apple Bank's Grand Yield Acct is down to .90%.

2
Comment #7 by across the pond (anonymous) posted on
across the pond
guess there are to many worms in the apple get it  gimbels

-4
Comment #8 by Anonymous posted on
Anonymous
To Maecl-

You can post rate changes in the "Rate changes and Deals" forum.

 

2