Yesterday I reviewed Capital One's InterestPlus Online Savings Account promotion. I just learned about a promotion for Capital One's Interest Online Checking Account. For new accounts, they are guaranteeing a 1.01% APY on balances up to $100K for 12 months. The offer is listed in Capital One's Interest Online Checking page as of 8/18/2011. Note, this account isn't available in areas where Capital One has branches (see below).
This rate isn't that great. For example, you can still get liquid accounts with 1.25% APY at some internet banks. However, the 12-month guarantee is nice. As we have seen since the Fed's mid-2013 pledge, rates continue to fall. I don't want to sound like a pessimist, but by next year, it may be tough to find liquid accounts paying 1.00%.
Here's the small print of the offer:
$500 minimum opening deposit required. As of 8/10/2011, a promotional annual percentage yield (APY) of 1.01% applies to account balances of $100,000 or less, and a promotional APY of 1.01% - 0.75% applies to balances of more than $100,000, depending on the account balance. An interest rate of 0.75% will be paid for the portion of your daily balance that is greater than $100,000. Both promotional APYs will expire 365 days after account opening. Upon expiration of the promotional APYs, the standard APY in effect as of that date will apply to the entire account balance.
The checking account has no minimum balance requirement and no monthly fees. However, the account requires a $500 deposit to open.
There have been a lot of concerns from ING Direct customers when they learned that Capital One will be acquiring ING Direct. Will Capital One increase fees? This Interest Online Checking Account is one example in which Capital One has fewer fees than ING Direct. For example, the first order of 50 checks is free. ING Direct just started to offer checks in which it charges $5 for 50 checks. Also, Capital One reimburses other bank ATM fees (up to $25 per month). ING Direct doesn't offer any reimbursements.
Those who travel overseas should like Capital One's debit card which has no foreign currency exchange fees. Most debit cards have a 2-3% fee that banks charge, plus Visa and MasterCard charge a 1% foreign currency exchange fee, which Capital One Bank absorbs and doesn't pass on to customers.
Local Capital One Bank Deals
If you live near a Capital One branch, you may want to check if they have any local deals. The best local deal is in Austin, Texas. Capital One branches in that metro area are offering the High Interest Free Checking account with a 1.30% APY for up to $100K guaranteed for 12 months (see my review).
Capital One Bank Overview
Capital One Bank branches are located in Texas, Louisiana, Maryland, Washington DC, Virginia, Delaware, New Jersey, Connecticut and New York.
Capital One Bank has two FDIC charters. Capital One Bank branches are under Capital One, N.A. (FDIC Certificate # 4297). Direct Banking is under Capital One Bank (USA), N.A. (FDIC Certificate # 33954).
Capital One, N.A. is a large bank with $128.7 billion in assets. It has an overall health score at DepositAccounts.com of 4 stars (out of 5) with a Texas Ratio of 10.19% (above average) based on March 2011 data. Please refer to our financial overview of Capital One, N.A. for more details.