EBSB Direct’s product line is structured differently than that of most other banks: rather than maintaining a relatively consistent number and type of products, EBSB Direct chooses to run limited-time specials. It’s like that box of chocolates – you never know what you’re going to get.
When I wrote about EBSB Direct three months ago, the Bank was offering three nationally available CDs, which were removed from the product line in early March. The latest CD is a limited-time 14-month CD Special (2.20% APY). The minimum opening deposit is $1k, with no stated balance cap. The CD Special is only available as a personal account and no IRA is offered.
According to the promotion page,
Upon maturity, 14-month CD renews to the then current 18-Month CD interest rate and term.
As stated in the Agreements and Disclosures document, the Early Withdrawal Penalty reads as follows:
A penalty will be imposed if you withdraw any of the principal before the maturity date as follows: terms over 12 months to 36 months the penalty will equal 6 months interest on the amount withdrawn.
Direct Money Market Special
From 2010 to 2016, EBSB Direct offered a Money Market account with rates that ranged from 0.80% APY to 1.30% APY. Beginning in May 2016, EBSB Direct started a dynasty of Money Markets.
- May 2016 - Money Market Special 2 (1.08% APY, $10k+) introduced; original Money Market (0.92% APY) maintained.
- October 2016 – introduction of Money Market Special 3 (the successor to the MMS2), with tiered APYs.
- December 2016 - EBSB Direct stops accepting new applications for MMS3.
- June 2017 - MMS3 again available, with the same rate tiers offered in October (1.25% APY, $10k-$2m).
- September 2017 - Money Market Direct (1.39% APY on balances of $50k+) unveiled.
That brings us to the latest offering, the Direct Money Market Special, which earns 1.57% APY on balances of $10k-$2m. Balances of $2m+ earn 0.80% APY, while balances between $10 and $10k earn 0.50% APY.
|1.57*%||$10k||$2m||EBSB Direct||Direct Money Market Special|
|OTHER TIERS: 0.50% → $10 - $10k | 0.80% → $2mm+|
According to the promotion page, the minimum opening deposit is $2.5k, and requires
New money or existing customer must deposit additional
money ($10k minimum) from another financial institution.
When I checked the Agreements and Disclosure brochure for more information, I was surprised to see the following at the top of the page,
TRUTH IN SAVINGS Money Market Special 3 Account
To my eye, the supporting documentation hasn’t been updated for the new Direct Money Market Special (even though it is dated March 2018) or someone just forgot to change the name. After a very frustrating conversation with CSR, I was able to confirm that 1) the Direct Money Market Special is indeed a new product, as of mid-March; 2) the information on the Agreements and Disclosure is correct; and 3) it should be titled Direct Money Market Special Account and not Money Market Special 3 Account.
DIF Deposit Insurance
EBSB Direct offers more protection for large deposits 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 a subsidiary of East Boston Savings Bank and has no brick-and-mortar branches. While U.S. resident aliens were able to open an account online in the past, the online application now reads,
If you are not an existing customer of East Boston Savings Bank,
you must be a U.S. Citizen to open an account with us.
Opening and funding the Money Market Direct and/or the CD must be done online. In the last year, EBSB Direct began to offer its product line nationwide; prior to that change, its market area had been limited to the Northeast.
According to the CSR, a beneficiary can be designated in the online application. When I asked about how many beneficiaries can be designated, the CSR said she had to check on that. I was then disconnected. If you find out the number of beneficiaries that can be designated, please leave a comment.
As an internet division of East Boston Savings Bank, EBSB Direct operates under the Bank’s FDIC Certificate and shares its financial history.
EBSB Direct/East Boston Savings Bank has an overall health grade of "A+" at DepositAccounts.com, with a Texas Ratio of 1.27% (excellent) based on December 31, 2017 data. In the past year, the Bank has increased its total non-brokered deposits by $165.54 million, an excellent annual growth rate of 5.46%. Please refer to our financial overview of EBSB Direct/East Boston Savings Bank (FDIC Certificate # 33510) for more details.
While EBSB Direct was established in 2009, East Boston Savings Bank (established in 1849) 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 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.
169 years later, following growth in size and scope (including a merger with Mt. Washington Cooperative Bank), East Boston Savings Bank is the sixth largest bank in Massachusetts, holding assets in excess of $5.2 billion.
How the CD Special Compares
When compared to the 208 similar length-of-term CDs tracked by DepositAccounts.com that required a similar deposit and are available nationwide, EBSB Direct's 14-Month CD Special APY currently shares the top spot with iGObanking and BankPurely’s 1-year CDs.
|Interest Rate||CD Length of Term||Credit Union/Bank|
|2.20% APY||14-Month CD Special||EBSB Direct|
|2.17% APY||12-Month CD||First Internet Bank|
|2.15% APY||1-Year CD||Live Oak Bank|
The above rates are accurate as of 3/28/2018.
To look for the best nationwide CD rates and the best CD rates in your state, please refer to our CD rates table.