Sallie Mae Bank continues to offer competitive internet savings account and CD rates. I first reported on the bank last March soon after they launched their internet bank. The rates have actually gone up a little since March as they try to attract deposits. In addition to a top savings account rate (1.40% APY as of 7/5/2010), there's a link to their Upromise Rewards Program which can make the savings account a little more profitable. Refer to my March Sallie Mae Bank review for more savings account and Upromise details. In this post I'll focus on the Sallie Mae Bank's certificates of deposit.
Three CD terms are currently offered. The rates as of 7/05/2010 include:
- 1.55% APY 12-month CD
- 2.40% APY 36-month CD
- 3.00% APY 60-month CD
Like the savings account, there is no minimum initial deposit. Some important features mentioned in the disclosure include:
- Interest rate is fixed and is established when your CD is opened
- You can receive interest disbursements monthly, quarterly, yearly or at maturity. Disbursements will be sent electronically to your linked checking account.
- Early withdrawal penalty is 3 months of interest on the amount withdrawn for the 12-month CD and 6 months of interest for the longer terms
- Grace period at maturity is 10 calendar days
- To withdraw funds during the grace period, you can provide instructions by phone during the grace period.
- If you choose not to renew your CD, interest will accrue until the day within the grace period that you withdraw your funds or that they receive notice.
Sallie Mae Bank Financial Overview
Sallie Mae Bank is sizable with $7.5 billion in assets and $6.1 billion in deposits. Its ratings for safety and soundness are above average: 4 stars (sound) at Bankrate.com, 3 stars (adequate) at BauerFinancial and an overall health score of 5 out of 5 at DepositAccounts.com (see our Sallie Mae Bank financial overview). These ratings are based on 3/31/10 data except for Bankrate which is based on 12/31/09 data. The bank has been a FDIC member since 2005 (FDIC Certificate # 58177).