EBSB Direct continues to offer a competitive 3-year CD rate of 2.25% APY. It's the same rate as in my last report on this bank in early October. With rates trending down since October, this rate has become even more competitive. There's also a 10-month CD, but the rate is less competitive at 1.05% APY. Minimum deposit is $1,000. These rates are listed at EBSBdirect.com as of 12/19/2010.
One thing that appears to have changed since my October post is a reduction in the early withdrawal penalty. According to the bank's disclosure, "terms over 12 months the penalty will equal 6 months interest on the amount withdrawn."
EBSBdirect.com continues to offer a savings account with a 1.30% APY for balances of $50K to $1 million (0.75% for $5K to $50K). This was a better deal in October due to the guarantee that the rate will last until January 1, 2011. With that date less than two weeks away, that's probably more of a downside instead of a plus since one would expect a rate cut in January. Another downside is the $15 monthly maintenance fee for balances under $5K. I first reviewed this savings account in May 2009 when they were guaranteeing 2.81% for over 4 months. As you can see, interest rates have fallen quite a bit over the last year, but the account has remained competitive. That review of EBSB Direct also included details about the bank's ACH transfer service.
New England and New York Only
When I called the bank in October, I was told that EBSB Direct now only accepts customers from New England and New York State. This doesn't seem to be stated on the website. A reader commented in October that you can open new accounts even if you don't live in the New England area as long as you have at least one account already.
EBSB Direct is an online division of East Boston Savings Bank. The bank has an overall health score of 3 out of 5 with a Texas Ratio of 22.49% (above average) based on September 2010 data. Please refer to our financial overview of East Boston Savings Bank for more details. The bank has been a FDIC member since 1991 (FDIC Certificate # 33510).