American Express National Bank is the first internet bank to raise the savings account rate following yesterday’s Fed rate hike. The Bank increased the rate of its American Express Personal Savings account (Personal Savings) by 10 bps to 2.10% APY. This rate is effective as of 12/20/2018. The Bank kept its CD rates unchanged. The last Personal Savings rate hike was on November 15th.
This moves American Express National Bank past many of the large and well-established internet banks. The list below shows the dates of the past two Personal Savings rate hikes and how they coincided with the last two Fed rate hikes and the rate hikes at the other large and well-established internet banks. I’m sure the other banks will also be responding to yesterday’s Fed rate hike, but several will probably wait until after the holidays.
- Dec 20: American Express National Bank Personal Savings: 2.10% APY
- Dec 19: Federal Reserve Target Funds Rate: 2.25% to 2.50%
- Dec 13: FNBO Direct Online Savings: 2.15% APY
- Dec 5: MySavingsDirect MySavings: 2.40% APY
- Nov 15: Ally Bank Online Savings: 2.00% APY
- Nov 15: American Express National Bank Personal Savings: 2.00% APY
- Nov 14: MySavingsDirect MySavings: 2.35% APY
- Nov 14: Discover Bank Online Savings: 2.00% APY
- Nov 9: Capital One 360 Money Market: 2.00% APY, $10k+
- Nov 6: Synchrony High Yield Savings: 2.05% APY
- Oct 30: Barclays Online Savings: 2.05% APY
- Oct 26: Goldman Sachs Bank USA High-yield Savings: 2.05% APY
- Oct 19: FNBO Direct Online Savings: 2.00% APY
- Oct 11: Discover Bank Online Savings: 1.90% APY
- Oct 3: Discover Bank Online Savings: 1.85% APY
- Oct 2: Synchrony High Yield Savings: 1.90% APY
- Oct 12: Goldman Sachs Bank USA High-yield Savings: 1.95% APY
- Oct 5: Ally Bank Online Savings: 1.90% APY
- Sep 27: American Express National Bank Personal Savings: 1.90% APY
- Sep 27: Barclays Online Savings: 1.90% APY
- Sep 26: Federal Reserve Target Funds Rate: 2.00% to 2.25%
Thanks DA reader, buckeye61, for posting on this rate hike in the DA forum.
Personal Savings Account Rate History and Features
The American Express Personal Savings has a long history. I first wrote about it in 2009. During that time, the account has never been a rate leader, but it has always been respectable when compared with other internet banks. The lowest rate it has ever been was 0.75% for a couple of months in 2012. In early 2015, the rate had gone back up to 0.90% where it held until the middle of May 2017 when the rate went up to 0.95%.
Even though there are now several online banks offering yields of over 2.10%, it’s worth noting that American Express National Bank has several features that give them an advantage over other internet banks. In fact, I seem to receive more positive opinions from readers about this bank than most other internet banks. In addition to not having monthly fees or minimum balance requirements, the Personal Savings has no dollar limitations for ACH bank-to-bank transfers. In addition, wire transfers are free. Readers have also commented about the bank’s fast ACH transfers, their top-notch user interface and excellent customer service.
Below are a few of the relevant features that are mentioned in the bank’s FAQ section that are worth repeating. I also included three features that were based on my conversation with a CSR on April 5, 2018.
- No monthly service fees or minimum required balance..
- ”maximum total account balance is $5 million”
- Two small test deposits are used to link external accounts
- Maximum of 3 external accounts can be linked at a time (according to CSR)
- For Pulling Funds from Your External Bank, ”On the day you initiate your transaction on the Personal Savings website, the funds will be reflected in your Current Balance and begin earning interest. [...] the funds will not appear in your Available Balance until the 5th business day after the deposit is initiated.”
- For Pushing Funds to Your External Bank, “On the day you initiate your transaction on the Personal Savings site, the amount will be deducted from your Current and Available balance and the funds transfer will be initiated. The funds will generally be reflected at your bank in 1-3 business days.”
- No dollar limits for ACH bank-to-bank transfers (according to CSR)
- No wire transfer fees (according to CSR)
- Wire transfers have a minimum amount of $500 per deposit or withdrawal (added to disclosure on 4-1-18)
- ”ATM cards, debit cards, or checks are not provided”
- Personal Savings “may not be opened in the name of a trust, IRA, or business”
- ”You may designate up to six (6) beneficiaries per account.”
- ”Beneficiaries named on POD accounts must be individuals; POD accounts cannot be set up in the names of trusts.”
American Express National Bank is an internet-only bank that is headquartered in Salt Lake City, Utah. The Personal Savings account and CDs can be opened online or by phone. You can fund the account by either linking your current bank account or by mailing a check.
To open an account with American Express National Bank, you must be at least 18 years old, a U.S. citizen or a resident alien with a valid Social Security number or other taxpayer identification number and have a residential address in the United States.
American Express National Bank used to be two separate banks, American Express Centurion Bank and American Express Bank, FSB, which operated under the American Express Company. That changed in April when these two banks merged into American Express National Bank. Also, the bank was converted into a national bank regulated by the OCC.
The merger of the two banks resulted in a national bank with assets in excess of $100 billion. As of September 30, 2018, American Express National Bank has assets in excess of $116 billion and is the 25th largest bank by assets in the nation.
The bank has an overall health grade at DepositAccounts.com of “A” with a Texas ratio of 4.70% (excellent) based on September 30, 2018 data. Please refer to our financial overview of American Express National Bank for more details. The bank has been a FDIC member since 1989 (FDIC Certificate # 27471).
How the American Express Personal Savings Account Compares
When compared to Savings Accounts and Money Market Accounts tracked by DepositAccounts.com that are available nationally with similar minimum balance requirements and without maximum balance limitations, eight savings accounts and four money market accounts have higher rates than the American Express Personal Savings Account rate.
The above rates are accurate as of 12/20/2018.