SunTrust Bank has brought back its special CD package. As you might expect, it's not as nice as what they were offering last year. Nevertheless, the current offer is competitive. The unusual feature is that it's actually two CDs: one with a 39-month term and one with a 63-month term. Both have a 2.40% APY. You must open both CDs with a minimum deposit of $2K for each CD for a total of $4K. Each CD must be funded with an equal amount. The special also requires that you have a SunTrust checking account. This can be opened at the same time that you open the CDs. The CDs are also available in an IRA. This CD special is listed at SunTrust's CD page as of 1/23/2011.
I called SunTrust (800.279.4824) today, and I confirmed that the special CDs and checking account can be opened by phone from any state. The funds can be pulled from your existing checking or savings account via an ACH debit. The rate should lock on the day of the application. SunTrust's Free Checking qualifies. I was told they do a soft credit inquiry via Equifax. According to the CSR, it's not a hard pull.
Early Withdrawal Penalty
SunTrust's CD early withdrawal penalties are not typical. According to the CSR, the penalty is based on the number of days before the CD matures. The closer to maturity, the smaller the penalty.
- If the CD has 91 days to under 1 year to maturity, the penalty is 3 months of interest
- If the CD has 1 year to under 3 years to maturity, the penalty is 8 months of interest
- If the CD has 3 years to under 7 years to maturity, the penalty is 12 months of interest
I was also told that each CD would be treated individually in terms of the early withdrawal penalty.
How to Compare with Other CDs?
This odd CD package makes it a little difficult to compare with regular CDs. A 2.40% APY is very competitive for both 3-year and 4-year CDs. However, it's a little low for a 5-year CD. The average maturity of 39 months and 63 months is 51 months which is just 3 months over 4 years. So comparing it to a 4-year CD may be the best approach.
For internet banks as of 1/23/2011, the best 3-year and 4-year CD rates are 2.00% APY and 2.25% APY at OneWest Bank, and the best 5-year CD rate is 2.75% APY at Salem Five.
SunTrust is a large regional bank with $123 billion in deposits. It's based in Atlanta, Georgia, and it has branches throughout the southeast in Alabama, Arkansas, Florida, Georgia, Maryland, Mississippi, North Carolina, South Carolina, Tennessee, Virginia, West Virginia and Washington DC.
SunTrust just reported its 4th quarter results on Friday. According to the The Atlanta Journal-Constitution:
The bank earned 23 cents per share, beating analysts expectations of around 7 cents. SunTrust lost $248 million, or 64 cents per share in the fourth quarter of 2009.
It was also mentioned that SunTrust signaled that "it will likely have to sell new shares to pay off its government debts." SunTrust is the largest bank that has still not fully paid back the $5 billion that it received from the government via TARP.
SunTrust Bank has an overall health score at DepositAccounts.com of 4 out of 5 with a Texas Ratio of 23.09% (above average) based on September 2010 data. Please refer to our financial overview of SunTrust Bank for more details. SunTrust has been a FDIC member since 1934 (FDIC Certificate # 867).