UPDATE 12/3/2016: The Money Market Special 3 (1.25% APY) is no longer available for new applications.
In May, I wrote about EBSB Direct’s new Money Market Special 2 that earned 1.08% APY on balances between $10k and $1m. Five months later, EBSB Direct has brought the new, improved model: Money Market Special 3 (MMS3), which earns 1.25% APY on balances between $10k and $2m. MMS3’s rate tiers are structured as follows:
0.00% APY – Less than $10 balance
0.25% APY – $10-$9,999.99 balance
1.25% APY – $10,000 -$1,999,999.99 balance
0.58% APY – $2,000,000 and above balance
Note: the MMS3’s fine print states "New money only," yet there is no mention of new money in the Agreements and Disclosure brochure. According to CSR, MMS3 does require new money, but existing EBSB Direct customers are “not prohibited from opening a Money Market Special 3 account.”
EBSB Direct’s Agreements and Disclosure brochure provides a great deal of information about the MMS3 account, including,
COMPOUNDING AND CREDITING – Interest will be compounded monthly and will be credited to your account monthly. If you close your account before interest is credited, you will receive the accrued interest.
MINIMUM BALANCE REQUIREMENTS – You must deposit $2,500.00 to open this account. If you maintain a $2,500.00 minimum daily balance during the statement cycle, the $8.00 monthly maintenance fee will not be assessed. You must maintain a minimum daily balance of $10.00 in the account each day to obtain the disclosed annual percentage yield.
FEES AND CHARGES - $15.00 fee for each transfer in excess of six during statement cycle.
Nationally Available CDs
EBSB Direct is also offering three CDs: 16-month (1.41% APY), 25-month Bump Up (1.41% APY), and 48-month (1.50% APY). I wrote in greater detail about these CDs in a May blog post when they became available nationwide. In the past five months, the 16-month CD has experienced a 6 basis point increase, while the 25-month Bump Up CD’s APY has remained constant and the 48-month CD APY has plummeted 63 basis points.
DIF Deposit Insurance
For those with large savings, EBSB Direct offers more protection through its Depositors Insurance Fund (DIF) membership. The DIF is a private, industry-sponsored insurance fund that insures all deposits above Federal Deposit Insurance Corporation (FDIC) limits at Massachusetts-chartered savings banks. The DIF has been insuring deposits since 1934.
As stated on EBSB Direct's About Us page,
As a member of both the Federal Deposit Insurance Corporation (FDIC) and the Deposit
Insurance Fund of Massachusetts (DIF), all of your deposits are insured in full. That means
that every dollar you have on deposit with East Boston Savings Bank is fully insured without limit.
Headquartered in Boston, EBSB Direct is an internet only bank and has no branch locations. Any U.S. Citizen or U.S. Resident Alien is eligible to apply for an account with EBSB Direct.
Opening and funding the MMS3 must be done online. In the past, EBSB Direct’s market area had been limited to the Northeast, but according to CSR, that has recently changed with all of EBSB Direct’s product line available nationally.
EBSB Direct (FDIC Certificate # 33510) has an overall health grade of "A+" at DepositAccounts.com, with a Texas Ratio of 6.01% (excellent) based on June 30, 2016 data. In the past year, EBSB Direct has increased its total deposits by $500.66 million, an excellent annual growth rate of 19.6%. Please refer to our financial overview of EBSB Direct for more details.
Established in 2009, EBSB Direct is an internet subsidiary of East Boston Savings Bank (established 1849), which can traces its beginning to the Noddle’s Island area, a center of commerce highlighted by shipbuilding, carpentry, sugar-refining and iron foundries. Those early merchants and world-famous shipbuilders were the leaders in the formation of East Boston Savings Bank.
On January 17, 1849, the first official business day of the Bank, 57 people deposited $2,999.00
at the Bank’s Maverick Square Office. The next day, the Bank’s Board of Investment voted to
purchase 15 shares of stock in the Merchant’s Bank of Boston and so began over 16 decades of
growth, prosperity and prudent asset management for the merchants and residents of East Boston.
165 years later, following growth in size and scope (including a merger with Mt. Washington Cooperative Bank), East Boston Savings Bank is the largest community bank in Suffolk County, holding assets in excess of $3.8 billion.
How the Money Market Special 3 Compares
When compared to the 168 Money Market Accounts tracked by DepositAccounts.com that are nationally available, EBSB Direct's Money Market Special 3 APY shares the top spot with All America Bank’s Mega Money Market ($35k max) and Redneck Bank’s Mega Money Market Account ($35 max).
The above rates are accurate as of 10/11/2016.