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Higher CD Early Withdrawal Penalties At Sovereign Bank, Citizens Bank & Bank Of America

Sunday, May 29, 2011 - 10:42 AM
From The Boston Globe:
The state’s three biggest retail banks — Bank of America, Citizens Bank, and Sovereign Bank — have significantly increased early-withdrawal fees in recent months. In many cases, the penalties are so steep that they would not only wipe out accrued interest, but also eat into the principal.

I reported on the larger early withdrawal penalty at Bank of America earlier this month. However, the EWP change at Sovereign Bank is new to me and since Sovereign Bank still offers one of the best 5-year CD rates (2.80% APY as of 5/29/11), this is an important change. According to the article:
Sovereign boosted its penalties in New England last month. For CDs of five years or longer, the bank now charges customers one year’s interest — up from six months under the old rules — for early withdrawal.

Ken TuminKen Tumin5,471 posts since
Nov 29, 2009
Rep Points: 125,632
1. Tuesday, May 31, 2011 - 9:49 AM
Do you know if Citizens or Sovereign are making this change applicable to existing CDs?
me1004me1004373 posts since
Jan 16, 2010
Rep Points: 2,597