First Internet Bank Raises Short-Term CD Rates Again

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Deal Summary: 12-month CD (1.71% APY), 18-month CD (1.79% APY), $1k minimum deposit

Availability: Nationwide (internet bank)

At the beginning of the year, First Internet Bank (First IB) began raising the rates on its 12- and 18-month CDs in small but steady steps. The latest increases happened this week, with the 12-month (1.71% APY) and 18-month (1.79% APY) reaching their highest rates in almost eight years. Since early January, the 12-month CD has gained 55 bps in ten rate increases, with the 18-month CD gaining 45 bps in nine rate increases.

APYMINMAXINSTITUTIONPRODUCTDETAILS
1.79%$1k-First Internet Bank of IN18 Month CD
1.79%$1k-First Internet Bank of IN18 Month IRA (Traditional, Roth)
1.79%--First Internet Bank of IN18 Month CESA
1.71%$1k-First Internet Bank of IN12 Month CD
1.71%$1k-First Internet Bank of IN12 Month IRA (Traditional, Roth)
1.71%--First Internet Bank of IN12 Month CESA
Accounts mentioned in this post. Rates as of December 11, 2017.

Any First IB CD can be opened with a $1k minimum deposit; there is no stated balance cap. 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 six months. First IB CDs are no exception to this trend, with only 67 bps between its 12-month CD (1.71% APY) and 60-month CD (2.38% 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.

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.

In the hopes that a third option to retrieve funds (preferably an ACH transfer back to the original funding account) had been added since I last wrote about First IB, I contacted the Bank. Unfortunately, CSR stated the two methods mentioned above are still the only options available.

Availability

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.

Bank Overview

First Internet Bank has an overall health rating of "A" on DepositAccounts.com, with a Texas Ratio of 4.06% (excellent), based on June 30, 2017 data. In the past year, First IB increased its total non-brokered deposits by $358.78 million, excellent annual growth rate of 25.91% 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 $2.3 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 149 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 second.

Interest RateCD Length of TermCredit Union/Bank
1.81% APY15-Month Special CDVeridian Credit Union
1.79% APY18-Month CDFirst Internet Bank
1.78% APY20-Month CDEBSB Direct

When compared to 208 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 third.

Interest RateCD Length of TermCredit Union/Bank
1.75% APY14-Month CDINOVA Federal Credit Union
1.72% APY12-Month IB CDIncredible Bank
1.71% APY12-Month CDFirst Internet Bank

The above rates are accurate as of 11/15/2017.

To look for the best CD rates, both nationwide and state specific, please refer to our CD rates table, or our new Rates Map page.

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

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First Internet Bank Continues To Raise Short-Term CD Rates
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Availability: Nationwide (internet bank)

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