EBSB Direct Introduces 20-Month CD


Deal Summary: 20-month CD, 2.69% APY, $1k minimum deposit, limited-time offer

Availability: Nationwide (internet bank)

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the maturity date as follows: terms over 12 months to 36 months the penalty will equal 6 months interest on the amount withdrawn.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$2mEBSB DirectMoney Market Special 3
OTHER TIERS: 0.50% $10 - $10k | 0.80% $2m+
Rates as of September 19, 2018.

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.

Bank Overview

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.

Related Pages: Boston CD rates, 1-year CD rates, nationwide deals, Internet banks

UCLA   |     |   Comment #1
I am in a quandary.

1.95% money market

2.00% 1 yr

2.69% 20 month

3.00% 5 year

no penalty 11 month CDs 1.75%

short term treasuries 2 year 2.54%

government agencies 10 year 3.25%

Inflation Hawk
Inflation Hawk   |     |   Comment #4
Here's a rehash of a comment I made on another thread evaluating things versus inflation (CPI-U).
I'm starting to lean towards "OR JUST KEEP READING KEN'S COLUMN ??".

Well, the CPI-U for April just came-out.
The trailing 12 month CPI-U rose to 2.5% from 2.4% in March (non-seasonally adjusted).

2 year CDs beat this month's CPI-U (the best has a 0.30% spread over the CPI-U).
One inherent value of CDs is that they are protected from fraud due to Regulation E (if you catch it quick enough).

iBonds are yielding 0.30% over the CPI-U (which makes them more attractive than CDs right now).
However, iBonds are not covered by the fraud protection of Regulation E (thru Treasury Direct ).

5 year TIPS are yielding 0.69% over the CPI-U (which makes them more attractive than iBonds right now).
However, TIPS are not covered by the fraud protection of Regulation E (either thru a broker or Treasury Direct).

The best savings account out there has a negative yield versus the CPI-U (-0.49%).
Two more 0.25% FED rate hikes could wipe-out that deficit (assuming no further CPI-U increases).

What's your poison?
scottj   |     |   Comment #5
It was easy to look smart locking in deals when rates were going down. Now the tough part, when to lock in when we have a rising rates environment.
pattyb53   |     |   Comment #7

I'm getting that 2% liquid savings, Popular Direct. Waiting for 3-4% short term to make the break.
Sperry8   |     |   Comment #10
@UCLA - no penalty CDs are 1.85% at CIT Bank (not 1.75% as you mentioned).

Personally I'm keeping primary cash at 2% liquid (Popular Direct). Also have a 2.5% 24 mo CD (opened 4 mos ago) at PurePoint. That is similar to this new 2.69% 20 mo CD - so it is a good deal.

Also - if you're in a high tax bracket you can look at Vanguard Municipal Money Market.
deplorable 1
deplorable 1   |     |   Comment #12
@UCLA: Easy this CD is by far the best option unless you already have the 24 month 2.7% add-on CD from bank 5 connect. Why? because it is 2.69% and only 20 months. This will most likely be a rate leader all the way to maturity.
Kirkland   |     |   Comment #2
except for the hassle of sending a certified return receipt letter to redeem this/and prevent it from automatically renewing, this 2.69% is a great rate!
Totally Nuts
Totally Nuts   |     |   Comment #3
Thanks for that tidbit.
Read the other reviews about trying to fund the account with this bank using ACH.
Totally nuts!
DCGuy   |     |   Comment #6
I did not have to send any certified return receipt letter to redeem any of the CD (3 of them) that I had with the bank. I just sent a message via their online message system and a CSR cashed out the CD and deposited it to the MM account. I never requested a paper check, so do not know the procedures for obtaining one.
The Mighty Sven
The Mighty Sven   |     |   Comment #8
I would no sooner sign up for one of these sub-3%, sub five year, CDs than slash my wrists. They are ubiquitous, though. So what message does that send? Message is that these are GREAT deals . . . . for the financial institutions.
111   |     |   Comment #9

I have 2.70%, 24-month, but ADD-ON, CD deals already established, very recently. Assume that "Person A" today buys one of these 2.69%, 20-month CDs mentioned in this post. If I "add-on" to my already-established CDs at any time during the next 4 months, "Person A's" deal will be essentially equal to mine - except that I will have had those 4 months to see what interest rates have done in the interim, to explore other deals, and to adjust accordingly.

Good deal for me - not so sure about Person A.
EBSB Direct Brings Back Money Market Special 3
Deal Summary: Money Market Special 3, 1.80% APY on balances between $10k and $2m, $2.5k (new money) minimum opening deposit.

Availability: Nationwide (internet bank)

EBSB Direct continually changes its product line - you never know what you're going to find. The newest offering is the re-appearance of the Money Market Special 3, which now 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.

According to the promotion page, the minimum opening...

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EBSB Direct Unveils 14-Month CD Special
Deal Summary: 14-month CD Special, 2.20% APY, $1k minimum deposit, limited-time offer. Direct Money Market Special, 1.57% APY on balances between $10k and $2m.

Availability: Nationwide (internet bank)

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...

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Competitive Rates on Money Market and 30-Month CD at EBSB Direct
Deal Summary: Money Market Direct, 1.39% APY ($50k+), 0.20% APY ($5k-$50k), minimum $5k opening deposit of new money. 30-month CD, 2.21% APY, $1k minimum deposit, new money, limited-time offer.

Availability: Nationwide (internet bank)

From 2010 to 2016, EBSB Direct offered a Money Market account with rates that ranged from 0.80% APY to 1.30% APY. In May 2016, EBSB Direct introduced its Money Market Special 2 (1.08% APY, $10k+), while still maintaining the original Money Market (0.92% APY). In October 2016, EBSB Direct unveiled its Money Market...

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EBSB Direct Reopens Money Market Special 3
Deal Summary: Money Market Special 3, 1.25% APY ($10k min/$2m max), minimum $2.5k opening deposit of new money; 19-month CD, 1.61% APY, $1k minimum deposit of new money.

Availability: Nationwide (internet bank)

In October, EBSB Direct introduced its Money Market Special 3 (MMS3), the successor to its Money Market Special 2, which had been added to the product line in May. In the beginning of December, EBSB Direct stopped accepting applications for the MMS3. As of this week, the MMS3 is available again, with the same...

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EBSB Direct Introduces Money Market Special

UPDATE 12/3/2016: The Money Market Special 3 (1.25% APY) is no longer available for new applications.

Availability: Nationwide (internet bank)

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...

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