EBSB Direct’s ever-changing product line has introduced a new CD: a limited-time 20-month CD, earning 2.69% APY. (The 2.20% APY 14-month CD added in April is still available.) The 20-month CD can be opened with a minimum $1k deposit and there is no stated balance cap. The CD is only available as a personal account and no IRA is offered.
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the maturity date as follows: terms over 12 months to 36 months the penalty will equal 6 months interest on the amount withdrawn.
According to the promotion page,
Upon maturity, 20-month CD renews to the then current 24-Month CD interest rate and term.
Accessing Maturing Funds
Like many financial institutions, EBSB Direct does not provide an answer on its website to that all important question, “How do I get my money?” While the Agreements and Disclosures states,
You will have a grace period of 10 calendar days after the maturity date of the
account to withdraw the funds without being charged an early withdrawal penalty.
there’s no mention of the actual withdrawal process.
According to CSR, upon receiving written instructions to withdraw all the funds upon maturity, “a check will be sent to the address on file.” When I asked if an ACH transfer back to the original funding account was an option, my answer was a curt, “No. Only a check.” I then asked if it’s possible to transfer the funds into an EBSB Direct Money Market account. CSR said “Yes, but the Money Market account must already be opened.”
Money Market Special 3
In late April, EBSB Direct brought back its Money Market Special 3, which currently earns 1.80% APY on balances between $10k and $2m. Balances of $2m+ earn 0.80% APY, while balances between $10 and $10k earn 0.50% APY.
|1.80*%||$10k||$2m||EBSB Direct||Money Market Special 3|
|OTHER TIERS: 0.50% → $10 - $10k | 0.80% → $2m+|
My April 27 blog post provides more information about the Money Market Special 3.
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 is strictly an internet bank, with 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 any type of account with EBSB Direct must be done online. About a year ago, EBSB Direct began to offer its product line nationwide; prior to that change, its market area had been limited to the Northeast.
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 less than ten years ago, 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 Compares
When compared to the 156 similar length-of-term CDs tracked by DepositAccounts.com that required a similar deposit and are available nationwide, EBSB Direct's 20-Month CD APY currently tops the list
The above rates are accurate as of 5/11/2018.
To look for the best nationwide CD rates and the best CD rates in your state, please refer to our CD rates table.