Dedicated to Deposits: Deals, Data, and Discussion
DETAILSINSTITUTIONAPYMINMAXPRODUCT
North Country Savings Bank1.05%-$25kAdvantage Checking
North Country Savings Bank0.05%--Advantage Checking
Accounts mentioned in this post. Rates as of April 23, 2014

Updated Review of North Country Savings Bank's Advantage Checking Account

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North Country Savings Bank

Last week I started writing updated reviews of some of the mature reward checking accounts that are still nationally available. In this updated review, I'm taking another look at North Country Savings Bank and its reward checking account that it calls Advantage Checking. I first reported on this account in 2009 when the yield was 3.00% for balances up to $50K. As you might have guessed, the rate has fallen. However, the balance cap remains at $50K (at least as of today). It's the only nationally available reward checking that still has a $50K balance cap. Most have reduced their caps to $25K with some as low as $10K.

Below are the rates and features of the Advantage Checking Account if certain monthly requirements are met (as of 5/10/2012):

  • 1.50% APY on balances up to $50,000
  • 0.75% APY on portion of the balance over $50,000
  • 0.15% base rate if requirements are not met
  • ATM fee refunds nationwide of up to $25

The monthly requirements include:

  • 10 debit card purchases
  • one Automatic Payment or Direct Deposit (including direct debit or EagleNET bill payment)
  • Enroll and receive e-statements

Additional features of the account regardless of the monthly requirements include:

  • $25 minimum initial deposit
  • No minimum balance requirement
  • No monthly service charge
  • Accounts with balances below $100 and no activity for 180 days will be closed
  • Qualifications for the first monthly cycle are waived

Account Application

There's a link to the online application available at the bank's Advantage Checking page. I confirmed with the bank this week that people from any state can apply online. The customer service representative gave me the following instructions for the online application. Unfortunately, it's not an all-online process:

All you have to do is follow the steps and then download the printable application, sign the forms and then mail them in with a check or money order to open the account.

Note, it's common for small banks to change their policy on nationwide availability. Since North Country Savings Bank hasn't changed its policy for 3 years, hopefully, there won't be a change.

Bank Overview

North Country Savings Bank branches are located in north New York State near the Canadian border.

The bank has an overall health score at DepositAccounts.com of 4 stars (out of 5) with a Texas Ratio of 8.01% (above average) based on December 2011 data. Please refer to our financial overview of North Country Savings Bank for more details. The bank was established in 1909 and has been a FDIC member since 1943 (FDIC Certificate # 16030).

How This Reward Checking Account Compares

With a yield of only 1.50%, you may wonder why anyone would choose this account over other nationally available reward checking accounts that have yields over 2.00%. The benefit of the Advantage Checking is that the 1.50% applies up to $50K. So for a $50K balance, you will earn more interest in this account than any of the other nationally available reward checking accounts. For example, INOVA FCU has a reward checking that pays 3.00% APY on balances up to $20K and 0.30% for the portion of the balance over $20K. If a $50K balance is maintained for a year with these rates, the total interest earned would equal $690. The total interest earned from the Advantage Checking would be $750.

The risk with the Advantage Checking is that the bank will cut the balance cap. That has been common for other institutions that have offered a $50K balance cap. In February 2011 I looked at 4 reward checking accounts with $50K balance caps. One of these 4 had a balance cap reduction that lowered the cap to $20K, and another one had a reduction that lowered it to $25K. However, 2 of the 4 have kept their $50K balance caps. One is Lake City Bank's reward checking account which has a 2.51% APY and the other is Market USA Federal Credit Union's reward checking account which has a 2.00% APY.

You can search for the best rates with various investment amounts by using our reward checking rate table. This can be used to find accounts that are local in your state and those that are available nationwide. If you're new to these tables, my rate table guide should be useful.

If you're new to reward checking, my blog post, 10 Common Traits of High-Yield Reward Checking, should be useful.

Update 5/22/2012: Comments from readers who claimed to be from banks had reported that the FDIC has been sending letters to "all of the banks to cut or close or convert all reward checking accounts." I asked my contacts at BancVue about this, and below is the reply I received:

We work with over 700 financial institutions across the country, and we have not received word from a single one of those institutions regarding letters from the FDIC concerning their relationship with us or issues regarding REWARDChecking or any of our other accounts. As you can imagine , should an institution receive such guidance from the FDIC, we would be the first to know about it, and there hasn't been one.
  Tags: New York, North Country Savings Bank, checking account, reward checking account

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Comments
6 comments.
Comment #1 by Anonymous posted on
Anonymous
A steep cap drop has been Bank of Fayetteville: 50k and now 15k.  

Rate was 2.25% for the 50k, but cap dropped to 25k Feb 2011. Rate cut to 2.03% Sep 2011 (kept 25k cap). Then latest cap drop to 15k Mar 2012 (kept rate 2.03%).

3
Comment #2 by Anonymous posted on
Anonymous
FDIC is sendig letters to all of the banks to cut or close or convert all reward checking accounts.

Sorry, can not disclose the bank I work for.

10
Comment #3 by KenBDG posted on
KenBDG
@anonymous #2, I'm a little skeptical of the claim that the FDIC is sending letters to all banks. Can you provide some excerpts from the letter?

There have been many cases in which the FDIC has ordered banks considered 'less than well capitalized' to lower their reward checking rates. I see no justification for a regulator to force healthy banks to close reward checking accounts. BancVue has made sure their reward checking accounts are set up to comply with all regulations, and they have over 5 years of history. I could see some banks which developed their own reward checking accounts with questionable features (like requiring certain purchase amounts) may be given orders by the FDIC to close or change their accounts.

8
Comment #4 by Anonymous posted on
Anonymous
Ken, #2 is correct in his/her statement.

Today FDIC can place any banking institution under part 337.6  restrictions, simply by the bank entering into contract with any third party, including the customers given preferential treatment in rates or any agreement with BancVue or anyone giving advise to the bank to adjust the rates.
In such cases, the FDIC will call the bank under section 29(g)3 or 29(c)3 and demand immediate cease and desist order of such preferential treatment of interest rates.

7
Comment #5 by Anonymous posted on
Anonymous
We are small bank in Florida and I know exactly what #2 and #4 are talking about, they are correct. The bank does not be insolvent to receive such warnings from FDIC.

5
Comment #6 by KenBDG posted on
KenBDG
I asked my contacts at BancVue about these supposed letters from the FDIC, and below is the reply I received:

"We work with over 700 financial institutions across the country, and we have not received word from a single one of those institutions regarding letters from the FDIC concerning their relationship with us or issues regarding REWARDChecking or any of our other accounts. As you can imagine , should an institution receive such guidance from the FDIC, we would be the first to know about it, and there hasn't been one."

2