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Ken Tumin founded the Bank Deals Blog in 2005 and has been passionately covering the best deposit deals ever since. He is frequently referenced by The New York Times, The Wall Street Journal, and other publications as a top expert, but he is first and foremost a fellow deal seeker and member of the wonderful community of savers that frequents DepositAccounts.

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Best Bank Account Interest Rates - Summary for Week Ending October 13, 2012

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The big banks are starting to report Q3 earnings. JPMorgan Chase and Wells Fargo reported their earnings this week, and as described in this Huffington Post article:

Both got a big lift from the mortgage market. Yes, the mortgage market, believe it or not. The mortgage market, in turn, has been supported -- and will continue to be supported for the foreseeable future -- by Federal Reserve Chairman Ben Bernanke.

The zero interest rates and the bond-buying by the Fed may be helping the big banks, but it's sure taking a long time to help the overall economy, and it's sure not helping savers. When I reviewed the latest deposit rates at Chase and Wells Fargo, I was surprised by how low their rates were. Chase had a special 5-year CD paying only 0.75%, and Well Fargo had a special 58-month CD paying only 0.80%. What's even more surprising, both banks reported deposit growth in Q3.

This was a light week for economic news. The Producer Price Index for September was released on Friday. The core PPI which excludes food and energy was flat for September which will make the Fed feel that it's on the right track. The September Consumer Price Index (CPI) will be released next Tuesday.

The flat core PPI, more European debt crisis concerns and the Fed's bond purchases contributed to falling Treasury yields this week, especially on the 10-year and 30-year Treasuries. The summary of Treasury yield changes over the last week and the expectation of future Fed funds rates are shown below. Numbers are based on Yahoo bond rate data and the CME Group FedWatch.

Treasury Yields:

  • 6-month: 0.14% up from 0.12% last week
  • 2--year: 0.26% up from 0.25% last week
  • 5--year: 0.66% down from 0.67% last week
  • 10-year: 1.65% down from 1.74% last week
  • 30-year: 2.83% down from 2.97% last week

Fed funds futures' probability of rate hike by:

  • Sep 2014: 37% up from 32% last week
  • Jan 2015: 52% up from 46% last week

This was another quiet week for the FDIC. There has yet to be a bank failure in October. The total number of bank failures for the year remains at 43.

Savings & Checking Account Rates

Two internet banks cut their rates this week. ING DIRECT reduced its savings and checking account rates by 5 basis points. This is the first time ING DIRECT had made rate cuts on these accounts since January.

The other rate cut was at a UFB Direct which doesn't have a record of holding steady on rates over a long period. UFB Direct's money market account yield fell from 1.10% to 1.05%. The 1.10% APY had been the highest rate for a non-promo account that's available to new customers. The 1.05% APY remains the highest rate, but it's shared with 5 other internet banks which also offer 1.05% APY on a savings or money market account.

There was one surprise this week. The new internet bank, ableBanking, raised its money market account yield from 0.90% to 0.96%. I first reported on this bank in July when its money market account yield was 0.85%. It's nice to see this has been rising. Like the other new internet banks, it's probably finding out that it's not easy attracting deposits with sub-one-percent rates. Hopefully, it will join the 1.05% club before long.

Finally, I added a new money market account to the list. It's the YES Money Market Account from Connexus Credit Union. The credit union has long offered this account. Since it now has such a competitive rate (for large balances), I thought it needed to be added. One downside is that the account requires an active checking account to qualify for the top yield. For those who have the Connexus reward checking account, this can be an easy requirement to meet.

Reward Checking Accounts

This was another week with no rate changes for the nationally available reward checking accounts that I monitor in this weekly post. In fact, this was the fifth straight week with no rate cuts or balance cap reductions.

To find the highest reward checking rates and balance caps in your state or nationwide, please refer to our reward checking rate table. If you're new to these tables, my new rate table guide should be useful, and if you're new to reward checking, my blog post, 10 Common Traits of High-Yield Reward Checking, should also be useful.

Additions:

  1. Connexus CU MMA - 1.15% ($100K+) 1.00% ($50K+) 0.75% ($20K+) 0.60% ($10K+) 0.50% ($1K) active chk required

Rate Hikes:

  1. ableBanking MMA - 0.96% [was 0.90%]

Rate/Balance Cap Cuts:

  1. UFB Direct MMA - 1.05% [was 1.10%]
  2. ING DIRECT EO - 0.85% ($100K+) 0.80% ($50K+) [was 0.90% ($100K+) 0.85% ($50K+)]
  3. ING DIRECT Orange Savings - 0.75% [was 0.80%]

Certificate of Deposit Rates

My recap of CD rate changes and the list of CD deals will now be in my survey of the best CD rates. This recap will now focus on banking news of the week and liquid accounts.

Recap for the Week - Links to This Week's Posts

Banking News/Resources Savings/MMA - National CD Deals/Resources - National Checking/Savings/CC Bonuses
  • No new posts this week
Reward Checking Accounts
  • No new posts this week
CD and Money Market Deals - Local Posts from Previous Weeks The rates listed below are based on Annual Percentage Yield (APY). No minimum balances are required unless noted. MMA next to the rates indicate a money market account. Most MMAs have check writing and ATM cards. Online savings accounts usually lack both of these. Previous weekly summaries are available at this page.

Rates as of October 13, 2012

Checking/Savings/Money Market Accounts:

  • Noteworthy Accounts Available Nationwide:

Reward Checking Accounts:

  • Noteworthy Accounts Available Nationwide:

Certificates of Deposit:

Various Deposit Account Deals

Bank Account Alternatives - NOT FDIC Insured

Historical Rates from the Federal Reserve (Federal funds, Treasury bills, CD's)


Related Posts

Comments
25 Comments.
Comment #1 by Anonymous posted on
Anonymous
Per Sheila Bair:

“The balance of power has shifted too far in favor of large financial interests in Washington,” she said in the interview. “The bailouts, and the quantitative easing that continues, have overwhelmingly benefited the upper classes. Workers, homeowners, small businesses have by and large been left to fend for themselves.”

13
Comment #2 by Paoli2 posted on
Paoli2
The problem with Sheila Barr is she makes statements that indicate she cares about the problem but when I wrote her about it and any help she might give, I did not even get a response from her one way or the other.  She is certainly right by saying we have been left to fend for ourselves and that includes any help she might be able to give us.

5
Comment #3 by grace maclean (anonymous) posted on
grace maclean
FYI, here is a banker's view of the current rate environment.

http://www.ababj.com/briefing/alco-beat-handling-a-sideways-rate-environment-3345.html

1
Comment #4 by Anonymous posted on
Anonymous
#3 are you suggesting he means more of the same?

1
Comment #6 by Shorebreak posted on
Shorebreak
"If there are no viable alternatives for investing excess liquidity, and deposit rates are on the floor, at zero, strong consideration must be given to assessing fees for "safekeeping" deposits, and offering a return of investment versus a return on investment."

There's your answer Paoli2. Clevenger is asserting that banking institutions will likely begin charging fees in exchange to guaranteeing to "return your investment". Interest income will be a thing of the past.

1
Comment #7 by Paoli2 posted on
Paoli2
Ok Shorebreak if this is to be what do they do about customers who have already locked in 5 or 6 year CDs at a certain interest rate?  Do they pay us interest until the CDs mature or do they just return all the funds back to us without a penalty?  There is no way I will let them keep my funds and pay them a fee for doing so.  I'll buy a special can first and safeguard my funds myself!  Do you realize how their actions, if they do activate them, will destroy the ability to save for the younger generation?  Our banking system as we know it would be changed forever.  Is this what we will come to in the US??  The Middle Class as we once knew it will no longer exist.  There will only be the poor and the wealthy (those who were able to save before our banking system was turned upside down!)

1
Comment #8 by Anonymous posted on
Anonymous
What I found interesting is the part where it stated that despite super low rates, the big banks have seen & continue seing a surge in deposits. Given that evidence, is it surprising that the banks feel that they may be able to get away with charging fees for holding your money??

Of course you don't have to just take this..............but a lot of people will do just that.

1
Comment #9 by Paoli2 posted on
Paoli2
Shorebreak or anyone who can reply:  What exactly do you understand the following paragraph from the article to mean?

"If there are no viable alternatives for investing excess liquidity, and deposit rates are on the floor, at zero, strong consideration must be given to assessing fees for "safekeeping" deposits, and offering a return of investment versus a return on investment."

What do they mean by "offering a return of investment versus a return on investment"?  Doesn't this indicate they still will have to pay us "some" return on our deposits?  Thanks.
 

1
Comment #10 by Shorebreak posted on
Shorebreak
Re: Paoli2 - #9, Sunday, October 14, 2012 - 4:30 PM


"If there are no viable alternatives for investing excess liquidity, and deposit rates are on the floor, at zero, strong consideration must be given to assessing fees for "safekeeping" deposits, and offering a return of investment versus a return on investment."

It means what it says. You get your principal back for a fee of course. By the way Paoli2, your criticsm of Former FDIC Chairman Sheila Bair was misplaced.
http://www.truthdig.com/report/item/truthdigger_of_the_week_sheila_bair_20121013/

3
Comment #12 by Anonymous posted on
Anonymous
You guys are getting confused with the language here. It's not that the banks are contemplating charging you money to get your deposit money back. As in you have to pay a fee to withdraw............... that is not it at all. 

What they are suggesting is something that is the de facto situation already...................& that is that whatever trivial amount that is paid in interest, be offset or more than offest by a monthly fee for running the account or for whatever else they can get away with charging you for. This may seem like a huge change but it's just a continuation of a trend whereby your principal is eaten into by inflation or fees...........or a combination of the two. 

1
Comment #13 by Anonymous/Paoli (anonymous) posted on
Anonymous/Paoli
#12  Your post is confusing.  I am not, at this time, paying any fees to any bank or credit union for any of my accounts including my checking.  If you mean it's mysteriously being a part of the low interest rate we get on CDs that is a different issue.  But to actually charge a "fee" to us for something must be shown on our statements.  This entire issue gets more confusing as we discuss it.  BTW, does anyone know if the credit unions we get CDs with are going to do whatever it is the banks are "supposed" to do as per fees?

1
Comment #14 by Shorebreak posted on
Shorebreak
Why is this so complicated? All the article's author was stating is that in the future, if interest rates stay low for so long of a period as the Fed intends to do so, that banks will merely start charging fees to maintain your money on account, regardless if interest is paid to you or not. It will not affect your current CD holdings. So stop sweating that.

2
Comment #15 by Anonymous/Paoli (anonymous) posted on
Anonymous/Paoli
Goodness, you could have posted that two hours ago and saved me all my questions.   I guess I better start looking for my steel box to be prepared if they are stupid enough to go through with such actions.

1
Comment #16 by Anonymous posted on
Anonymous
Or instead of the "steel box", you could also decide to stop fighting the trend & invest in something other than CSs..............at least with a percentage of your assets. It doesn't always have to be a all or nothing discussion or decision.

2
Comment #17 by Anonymous posted on
Anonymous
I meant CDs of course

2
Comment #18 by Shorebreak posted on
Shorebreak
Re: Anonymous - #16, Monday, October 15, 2012 - 2:58 AM

Right on the mark...

“In a world where people are lined up to go broke, a well-diversified portfolio should put you well toward the end of the line. The folks who put all their money in CDs will likely be toward the front of the line. Being at the back of the line is about as good as it gets when trying to prepare for a broad disaster. Anything more focused puts you in a “bet the ranch” position.”

http://assetbuilder.com/scott_burns/worried_about_the_economy_you%E2%80%99ve_got_lots_of_company

2
Comment #19 by AnonymousPaoli (anonymous) posted on
AnonymousPaoli
Oh! Oh!  Shorebreaker has been taken over by the financial guys.  Probably even got some Sara Lee stocks! :)  I like to be the first in everything guys so I'll stick with my box.  Thanks anyway.

1
Comment #20 by Shorebreak posted on
Shorebreak
Re: AnonymousPaoli (anonymous) - #19, Monday, October 15, 2012 - 8:36 AM

I have not been "taken over" by anyone. Prudence beats stubborness every day. I'm protecting my assets as best as possible rather than being "toward the front of the line" when it comes to being "lined up to go broke".

2
Comment #21 by Paoli2 posted on
Paoli2
#20:  I was just jesting with you.  You have every right to handle your finances any way you want.  Why is your way "prudence" and mine "stubborness"?.  Maybe I am less lined up to "go broke" than you are.  I don't research these blogs and articles every day just for lack of nothing better to do.  I have a feeling I am way more prudent than you could believe.  Have a nice evening.

2
Comment #22 by Shorebreak posted on
Shorebreak
Re: Paoli2 - #21, Monday, October 15, 2012 - 6:52 PM

"Maybe I am less lined up to "go broke" than you are."

That will be the day. Good thing I'm doing it my way rather than having all my eggs in one CD basket like you. Good luck in the ZIRP world.

1
Comment #23 by Anonymous/Paoli (anonymous) posted on
Anonymous/Paoli
Re: #22  You have NO idea where my eggs are so don't be so quick to judge my tactics.  When it comes to finances, no matter what we are invested in, it can go south depending on what happens to our economy and the world's economy.  So don't be so smug about how safe you think you are.  I hope all of us have protected assets no matter what they are in but only the future knows who will be at the front of the line and who will be pulling up the rear.   Before you pat yourself so smugly on the back why don't you read the article as to why so many billionaires are already cashing out of stocks!  We may be entering an era where nothing is really safe, stocks, cds or banana nut cake!  Best of luck with wherever your eggs are!

2
Comment #24 by Shorebreak posted on
Shorebreak
"You have NO idea where my eggs are"
Oh my, you have revealed that a long time ago, supposed rix-free all fkixed income. Don't try to back out now Paoli2. Your gooose is cooked. See ya!

2
Comment #25 by Shorebreak posted on
Shorebreak
Excuse the spelling. I don't spend all my time, like you do, monitoring this site.

1
Comment #26 by Anonymous/Paoli (anonymous) posted on
Anonymous/Paoli
Shorebreak:  I am sooo disappointed in you.  You actually believe everything you read on the internet!!  BTW, if you check our posts, I think you can find YOU eat, drink, and sleep on this blog and forum.  You are the King of posting and I sure don't pretend to be your queen!  Now go count your money and stay happy!

2
Comment #27 by O-Qua Tanginn Wann (anonymous) posted on
O-Qua Tanginn Wann
Ken, notice from Morrill & Janes Bank that they are closing every out of state Internet account, and that we have until the end of November to pull out our money. If any money remains after November, all accounts will be automtaically closed and balance mailed. They included a note reitertating that they are allowed to close your account at any time for any reason. I enjoyed their Treasury Index Account for a while (I am in California), but no more. 

1