Dedicated to Deposits: Deals, Data, and Discussion

Best Deal for CDs Is Now at GE Capital Retail Bank

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GE Capital Retail Bank (GECRB) had another rate increase on its 5-year CD and IRA CD. Its "mini Jumbo" 5-year CD APY was increased from 2.25% to 2.30%.This require a $25,000 minimum deposit. The rate is 5 basis points lower for a $2,000 minimum deposit. This is now the highest 5-year CD rate for a $25K deposit that’s available nationwide. CIT Bank is also offering a 2.30% APY but this requires a $100K minimum deposit.

DETAILSINSTITUTIONAPYMINMAXPRODUCT
Synchrony Bank2.30%$25k-60 Month CD
Learn MoreSponsored Note: Synchrony Bank was formerly GE Capital Retail Bank. FDIC Insured.
Accounts mentioned in this post. Rates as of August 27, 2014

Early Withdrawals for CDs and IRA CDs

The bank’s CD early withdrawal penalties are fair. According to the bank’s account agreement (see disclosures link at the bottom left of the bank’s home page):

For a CD with a term of twelve months or less, the penalty will be an amount equal to 90 days simple interest on the amount withdrawn at the current rate. For a CD with a term of more than twelve months, the penalty will be an amount equal to 180 days simple interest on the amount withdrawn at the current rate.

This makes the 5-year CD an excellent deal even if you prefer short-term CDs. You can see the effective yields when this 5-year CD is closed early using our CD early withdrawal penalty calculator (I’ve already pre-filled the GECRB 5-year CD into the calculator).

Another important thing to note in this account agreement is the early withdrawal penalties for IRAs. According to the account agreement (I highlighted the important part):

An early withdrawal, without penalty, is allowed only in the event of (a) ….. (b) ….. or (c ) when the account is an IRA and the owner dies, becomes permanently disabled or reaches the age of 59½; or (d) within the grace period.

Earlier this year I called the bank to confirm this and to see if they have any restrictions on this. According to an IRA specialist, they will allow an IRA customer who’s over the 59 ½ to close an IRA CD without penalty and open a new IRA CD with a higher rate.

Other Things to Consider

In my conversation with the IRA specialist, I was told that CDs can be funded with an ACH transfer, and the maximum amount is $500,000.

They do allow POD account beneficiaries for both regular and IRA accounts. I was told their standard form allows for a maximum of four beneficiaries, and the beneficiaries can be both persons and organizations (like charities). You can also open an account in the name of a trust.

New Competitive Savings Account

Earlier this year GECRB made its savings account competitive. It’s called Optimizer+plus High Yield Savings, and it has a rate of 0.95% for all balances (as of 4/29/2014). One potential gotcha that I see is a $5 monthly fee if the balance falls below $50. Another downside is a small ACH transfer limit. I was told by the bank CSR that the maximum transfer limit is $50,000.

Update: I just called to verify if this limit is up-to-date. I was told that there is a limit of $50,000 per transfer. However, I was told there is no daily or monthly limit. Also, there's no dollar limit if the ACH transfer is initiated from another bank. Of course, withdrawals are limited to 6 per month based on federal regulation.

Update 4/30/14: I just received a reply via GECRB's secure message. This time they said the limit is $100,000. Here's an excerpt from the message:

There is no dollar daily or monthly limit. There is a limit of $100,000 per ACH transfer entered online. If you wish to transfer more than that amount you would need to enter multiple transfers or call a Banking Representative. This is for both incoming and outgoing transfers.

ID Theft Resolution Service

The bank still offers a free identity theft resolution service for its deposit customers. Here’s how the bank describes its service:

GE Capital Retail Bank provides deposit account holders with complimentary Identity Theft Resolution Services through Identity Theft 911® just for banking with us. If you are ever a victim of Identity Theft, you'll have the assistance you need to help you get your life back to normal as quickly and easily as possible.

For more details refer to the bank’s "Secure Banking" page. The link to this page is under the "Resource Center" on the bank’s top menu.

Bank Overview

In January 2013 MetLife officially became GE Capital Retail Bank. As I mentioned in 2013, the products remained the same including the CDs, IRAs and money market accounts.

GE Capital Retail Bank’s main office is located in Draper, Utah. The bank has been around for awhile. It was established with FDIC insurance in 1988. However, it has not been in the retail deposit-taking business before the MetLife Bank acquisition. Its business focus has been on providing customized credit programs to retailers and consumers.

The bank has an overall health grade at DepositAccounts.com of an A with a Texas ratio of 8.05% (excellent) based on December 2013 data. Please refer to our financial overview of GE Capital Retail Bank for more details.

GE Capital vs. GE Capital Retail

One thing that’s confusing is that there are two GE Capital banks. The former MetLife Bank is GE Capital Retail Bank which I described above. GE Capital Bank is the other bank. It started offering an online savings account and CDs in May 2013. These are two separate banks, but both are part of the General Electric Company. They have separate FDIC certificate numbers (27314 for GE Capital Retail bank and 33778 for GE Capital Bank), and deposits in these two banks should be treated separately from a FDIC deposit insurance point of view.

GE Capital Bank also offers competitive rates. These two banks appear to be competing with each other which seems strange since they’re under the same parent company. Nevertheless, this competition is good for us savers. I hope they don’t consolidate these two banks.

Other CD and IRA CD Rates

To search for the best nationwide rates and best rates in your state, please refer to the CD rates and IRA CD rates tables of DepositAccounts.com.


  Tags: CD rates, IRA rates, savings account

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Comments
10 Comments.
Comment #1 by Anonymous posted on
Anonymous
Thanks for describing the difference between GE Cap and GE Cap Retail. Didn't know that. They always have a lot of brokered CD offerings too.

4
Comment #2 by paoli2 posted on
paoli2
Both of our brokerages sell a lot of GE Capital Retail CDs.  I use them a lot for DP's Rollover IRAs  because even though their rates are not great they are always a tiny bit higher than others.  Nowadays, even a "tiny bit more" is better than the norm.  I have never bought their CDs for our personal accounts but would not hesitate to do so if need be.

3
Comment #3 by Sylvia posted on
Sylvia
Earlier this year GECRB made its savings account competitive. It’s called Optimizer+plus High Yield Savings, and it has a rate of 0.90% for all balances (as of 4/29/2014). One potential gotcha that I see is a $5 monthly fee if the balance falls below $50. Another downside is a small ACH transfer limit. I was told by the bank CSR that the maximum daily transfer limit is $50,000.
The savings rate is .95% (https://www.myoptimizerplus.com/banking/products/high-yield-saving/index.htm?UISCode=0000000), right?

In secure messaging just last week, I asked about the ACH limit.  The answer I received from bank:  "There is no daily dollar limit but there is a limit of $100,000 per transfer.  For amounts more than that you will need to do multiple transfers."  Might the $50K reference be dated?

5
Comment #4 by Ken Tumin posted on
Ken Tumin
I forgot about their recent savings account rate hike. I just updated the post to show the current rate is 0.95%. Thanks.

I also rechecked about the ACH transfer limit. I was told by phone it's still $50K. However, it is per transfer and not per day. I updated that in the post. I also sent a secure email to double check. I'll update the post once I receive a reply. Thanks.

6
Comment #5 by Anonymous posted on
Anonymous
Virtual Bank has just announced new rate for 5-year CD of 2.31APY, beating out GE.

6
Comment #6 by Ken Tumin posted on
Ken Tumin
Thanks for the alert. I'll have more on this soon.

4
Comment #7 by Anonymous posted on
Anonymous
Hi, Great info, but your address is incorrect. GECRB is located at: 200 Crossing Blvd Suite 101 Bridgewater, NJ 08807

1
Comment #8 by paoli2 posted on
paoli2
Does anyone have any input about which bank is easier to purchase CDs online from?  One I think does a few extra withdrawals from your bank account before they do the actual ACH for the CD you want.  Does that make it more complicated?  Thanks.

1
Comment #9 by Sylvia posted on
Sylvia
When purchasing from outside my area, I prefer a bank/credit union that allows in and outbound ACHs.  I had one bank that allowed it for funding CD but later restricted electronic means upon maturity -- no ACH, wire xfer only if I presented request in person, which effectively limited me to waiting for a paper check by mail.  Moreover, for that check, the bank required that I submit a notarized letter, even though it would be sent to my address on record.

Those withdrawals (sometimes they're deposits) you mentioned are necessary to verify that the source account you indicate is yours.  That part of the process does add a couple days, but, practically speaking, no more than if you were to send a check in the mail.  Plus, it's safer, in my opinion.  There's no worry of a lost check en route.

Upon establishing that source account for ACH, a few places will allow you later to do outbound ACHs with it.  At maturity, that will make it easy and quick for you to retrieve funds, if you choose not to rollover. 

1
Comment #10 by paoli2 posted on
paoli2
thanks for the explanation, Sylvia.  I like the part about being able to have them ACH the balance back to me at maturity if possible.  Much appreciation.

1