In the first two months of the year, First Internet Bank (First IB) raised the rates on all its CDs twice. First IB has upped its CD rates today for a third time in as many months, with increases between 3 and 16 bps. While the new APYs are not outstanding, the 12-month CD (2.10% APY) and 48-month CD (2.58% APY) are still quite competitive. First IB CDs can be opened with a $1k minimum deposit; there are no stated balance caps.
|2.68%||$1k||-||First Internet Bank||48 Month CD|
|2.68%||$1k||-||First Internet Bank||48 Month IRA (Traditional, Roth)|
|2.22%||$1k||-||First Internet Bank||12 Month CD|
|2.22%||$1k||-||First Internet Bank||12 Month IRA (Traditional, Roth)|
In the past year, the 12-month CD has gained 77 bps in 14 rate increases, with the 48-month CD gaining 71 bps in seven rate increases.
The CDs are also available as IRAs (Traditional, Roth, and CESA), earning the same APYs and with the same funding requirements.
First IB CDs exhibit the same flattening yield curve (relatively small difference between short- and long-term rates) that the majority of CDs being offered today are experiencing. Based on today's new rates, there is only a difference of 63 bps between First IB's 12- and 60-month CDs.
According to First IB’s CD Overview page, the Early Withdrawal Penalty for the 12-month CD 180 days interest, and 360 days interest for the 48-month CD.
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 Maturing 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 2.47% (excellent), based on December 31, 2017 data. In the past year, First IB has increased its total non-brokered deposits by $554.48 million, excellent annual growth rate of 37.3% 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 18 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 $2.76 billion and continues to be recognized as a top online bank.
In an December 2017 American Bank article, First IB’s CEO, David Becker, discussed his goal of “convincing doubters a branchless model works."
Do you anticipate such growth continuing?
We’re at 40% growth when the industry is at 3.5% to 5%. We anticipate somewhere in the 30% range next year. The key is great quality assets. We don’t want to grow for the sake of growth. There are good opportunities and we’re able to generate good assets. We have a great deposit base. The advantage we have with a national footprint is, if the economy is a little soft in one part of the country, you have the rest of the country to pull from. Our model makes us stronger in tough economic times than a traditional bank because we aren’t landlocked with a certain set of customers.
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 third.
When compared to 169 similar length-of-term CDs tracked by DepositAccounts.com, requiring a similar minimum deposit and available nationally, First Internet Bank’s 48-month CD APY currently ranks third.
The above rates are accurate as of 3/14/2018.
To look for the best CD rates, both nationwide and state specific, please refer to our CD Rates Table page.