Non-Reward Checking Account with Rates up to 3.12% at F&M Bank - CA Only


F&M Bank is offering a checking account called SkyBlue Checking. It's a non-reward type of checking account with a top rate of 3.12% APY as of 4/23/09. However, to earn this top rate, you must have a balance of $50,000. The APY drops as the balance goes below or above $50K. This is due to the following rate tiers as of 4/23/09:
  • 1.00% for balances up to $5,000 and for portions of the balance below $5,000
  • 3.30% on portion of the balance from $5,000 to $50,000 (APY ranges from 1% to 3.12%)
  • 2.30% on portion of the balance above $50,000 (APY ranges from 3.12% to 2.36%)
So for a $50K balance, the first $5K earns 1% and the $45K earns 3.30% which gives you a blended rate of 3.12% APY. So you can see if you only have a $10K balance, the blended rate will be 2.15% (half way between 1% and 3.30%).

Unlike a reward checking account, this does not require debit card usage or direct deposits. It has no monthly service charges. A $50 minimum opening balance is required. Only one account allowed per household.

The account can only be opened online. However, it doesn't seem to be a nationwide deal. In the application it states the following: "All accounts with F&M Bank should be opened by customers that live or work within our service area." After the account is opened, customers may bank in any of their branch locations at no additional cost.

Branches are located through out California's Great Central Valley includin the cities of Sacramento, Lodi, Stockton and Turlock.

The bank's ratings for safety and soundness are strong: 5 stars (superior) at BauerFinancial and 5 stars (superior) at Both ratings are based on 12/31/08 financial data. Such high ratings are rare especially for a California bank. The bank has been FDIC insured since 1934 (FDIC Certificate # 1331).

Thanks to the reader who emailed me info on this account.
Related Pages: checking account

  |     |   Comment #1
Funny how regular checking accounts are now labeled "Non-Reward." Reminds me of how regular internet searching is now labeled "organic."

I just threw up in my mouth a little.
  |     |   Comment #2
Don't confuse this F&M Bank with the F&M Bank of Long Beach, CA. They are unrelated. F&M Bank of Long Beach does NOT pay high rates.

OC Steve
  |     |   Comment #3
Wow ... for once I'm in the local group. Just finished online application which went fine. Also spoke to Customer Reps with a few questions and they were most helpful. This account is just what the doctor ordered ... thanks BG!!
  |     |   Comment #4
Thanks, OC Steve, for clarifying what you did.

I live in Orange County, and when I first saw F&M, I first thought (hoped) it was the Farmers & Merchants Bank, with a branch in Tustin, etc.
  |     |   Comment #5
I called the bank. The account is opened for local residents only in their service cities. I am in Los Angeles. So I am not qualified. Besides, they don't seem to allow inter-bank ACH transfers. I just have to keep searching and waiting for another good rate offer.
  |     |   Comment #6
As someone else mentioned, finally an excellent option, and I'm in the local group. I opened the online applicaton and just returned from my local bank where I handed the teller my opening deposit.
Even though we cannot open this Sky Blue Checking account at the local bank, I did get some helpful information from the Branch Manager.
  |     |   Comment #7
simple interet only
  |     |   Comment #8
Opened my account....easy!

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