Colorado Federal Savings Bank 12-Month CD Is New Rate Leader

In a series of four rate increases in as many months, Colorado Federal Savings Bank (CFSB) has added a total of 62 bps to its 12-month CD. With the largest increase (30 bps) occurring this week, the 12-month CD earns 1.35% APY, which is the highest rate currently available on nationally available 1-year CDs (minimum deposit of $10k or less). The minimum opening deposit is $5k, with no stated balance cap.

Five other CFSB CDs had rate increases this week, but none of them are as competitive as the 12-month CD. These CDs also require a $5k minimum opening deposit.

11-Month No Penalty CD

While still offering a competitive 0.75% APY, the 11-month No Penalty CD has had only modest increases in the past six months, gaining a net total of 30 bps. After a 17 bps increase in February, the Penalty CD earned 0.82% APY, which was the highest no-penalty rate available at the time. Unfortunately, that rate only lasted for about ten days before dropping to 0.70% APY, where it remained until this week’s 5 bps increase. Complete details about the 11-month No Penalty CD can be found in this February blog post.

How the CFSB CDs Work

Note: Links to all the documents referenced below can be found on CFSB’s FAQs page or the Savings & CDs page.

As stated on the Savings & CDs page, the Early Withdrawal Penalty reads as follows.

Early Withdrawal Penalty for withdrawals prior to maturity date equals 1 month of interest on Certificate Term of less than 6 months, 3 months’ worth of interest on Certificate Term of 6 months and one year, and 6 months’ worth of interest for a certificate term over one year.

The Disclosure of Account Terms on the Savings & CDs page also states:

At redemption, funds will be returned to the original external account utilized to open the CD. Please fund your CD from an account you intend on keeping open to reduce any delay in the return of your proceeds. If your funding account is closed, we will need to complete a verification of account between us and your new bank before we can Automated Clearing House (ACH) transfer your funds to your account. Colorado Federal Savings Bank does not issue checks to close online accounts.

Long story short, make sure the account you link to the CD when funding is an account you will keep open for the term of the CD, as CFSB is not flexible on this point.

CFSB began to offer PODs almost six years ago. According to the FAQs page:

The bank will only allow U.S. citizens and permanent resident aliens with a valid social security number to be added as a POD to an account. PODs can be added via the online application for new customers and secure message for existing customers. The bank will allow four joint owners to be designated on an account and up to five payable on death designations per account in equal percentages.

While CFSB’s position on PODs has changed, their position on trust or business remains the same – “No, we do not offer trust or business accounts.”

While the FAQ page provides many answers, more detailed information can be found in the Disclosure of Account Terms on the Savings & CDs page.

Availability

As an internet bank, CFSB offers its CDs and Savings accounts all US citizens (18 years or older) who have a valid Social Security number. While CFSB's headquarters in Greenwood Village (15 miles south of Denver) provided a brick-and-mortar location in the past for local customers, this is no longer an option. Opening any type of account, and all subsequent transactions, must be done online.

Bank Overview

Colorado Federal Savings Bank has an overall health rating of "B+" at DepositAccounts.com, with a Texas Ratio of 0.11% (excellent), based on December 31, 2021 data. CFSB has an excellent capitalization level (12.30% APY), the result of holding $2.09 billion in assets with $256.51 million in equity. Please refer to our financial overview of Colorado Federal Savings Bank (FDIC Certificate # 33111) for more details.

Established in 1990 as a savings institution, Colorado Federal Savings Bank was acquired by new ownership in 2008. The new owners contributed more than $100 million in assets and $10 million of capital “to put the bank on solid footing.” Currently operating as a non-branch direct banking platform, CFSB is Colorado’s ninth largest bank, with deposits in excess of $1 billion and nearly 108,000 customer accounts.

How the 12-Month CD Compares

When compared to similar length-of-term CDs tracked by DepositAccounts.com that are available nationally and have minimum deposit requirements of $10k or less, no banks or credit unions have a higher rate than currently offered on the CFSB 12-month CD. The following table compares the CFSB 12-month CD to the two highest-rate CDs from other banks and the two highest-rate CDs from credit unions.

The above information and rates are accurate as of 4/28/2022.

To look for the best CD rates, both nationwide and state specific, please refer to our CD Rates Table page.