First Internet Bank (First IB) has ended the week by raising the rates on all its CDs, with increases between 5 and 16 bps. While none of the new rates are really “wow-worthy,” the 12-month CD (1.87% APY) and 18-month CD (1.97% APY) are nonetheless competitive. In the past year, the 12-month CD has gained 71 bps in twelve rate increases, with the 18-month CD gaining 66 bps in ten rate increases.
Any First IB CD can be opened with a $1k minimum deposit; there are no stated balance caps. The CDs are also available as IRAs (Traditional, Roth, and CESA), earning the same APYs and with the same funding requirements.
The flattening yield curve (little difference between short- and long-term rates) that the majority of CDs are experiencing should be familiar to DA readers, as I’ve mentioned several times in the past year. First IB CDs are no exception to this trend, with only 66 bps between its 12-month CD (1.87% APY) and 60-month CD (2.53% APY).
According to First IB’s CD Overview page, the Early Withdrawal Penalty for the 12-month or 18-month CD is 180 days interest.
First IB permits CDs and savings accounts to be opened in the name of a trust. As stated on the online application,
For any trust accounts, we require copies of trust documents verifying trustee(s).
Please submit via recommended instructions listed at the completion of the application.
Accessing Your Funds
Accessing maturing CD funds from internet banks can be a concern, as some institutions make it much easier to deposit your money then withdraw it. According to First IB’s FAQs,
If you notify us in writing prior to the maturity date that you do not wish to renew the CD, we will close the CD on the maturity date and mail a check to you for the balance of your CD.
If you’re looking to have immediate access to maturing funds,
If you also have a First IB checking or savings account, you may use online banking by going to Additional Services, then CD Maturity Options. You can transfer the entire balance of your mature CD into your checking or savings account and close the CD.
Headquartered in Fishers, Indiana, First Internet Bank provides internet banking services and products nationwide. All First IB accounts can be opened online, but First IB does allow CDs to be opened through the mail.
CD and IRA CD rates are guaranteed as of the postmark date on the
envelope containing the signed application and funding for the account.
First Internet Bank has an overall health rating of "A" on DepositAccounts.com, with a Texas Ratio of 3.35% (excellent), based on September 30, 2017 data. In the past year, First IB increased its total non-brokered deposits by $510.28 million, excellent annual growth rate of 34.06% growth rate. Please refer to our financial overview of First Internet Bank (FDIC Certificate # 34607) for more details.
Opening its virtual doors in early 1999, First Internet Bank was the first state-chartered, FDIC-insured institution to operate solely via the internet. In the following 17 years, First IB accumulated accolades (including being named #1 Online Bank by Gomez Advisors in 2001), while expanding in size and scope. First IB currently has assets in excess of $2.6 billion and continues to be recognized as a top online bank.
In an August 2017 press release,
First Internet Bank announced it has earned the tenth spot on the list of the Best Banks to Work For, a nationwide ranking by American Banker and Best Companies Group. First Internet Bank has earned the distinction every year since the program was created in 2013. The 2017 “Best Banks” list recognizes 75 employers in the banking industry.
How the CDs Compare
When compared to 204 similar length-of-term CDs tracked by DepositAccounts.com, requiring a similar minimum deposit and available nationally, First Internet Bank’s 12-month CD APY currently ranks sixth.
When compared to 145 similar length-of-term CDs tracked by DepositAccounts.com, requiring a similar minimum deposit and available nationally, First Internet Bank’s 18-month CD APY currently ranks sixth.
The above rates are accurate as of 1/19/2018.
To look for the best CD rates, both nationwide and state specific, please refer to our CD Rates Table page.