Update on Hanmi Bank in California - Deposit Deals and Financial Condition

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Hanmi Bank continues to offer some competitive deposit rates, but recent news raises questions about the bank's financial health. On November 5th, Hanmi issued a press release in which it described requirements placed on it by regulators:
By July 31, 2010, the Bank will be required to increase its contributed equity capital by not less than an additional $100 million.

This LA Times article has more discussion on Hanmi and its plans to raise new capital.

If you stay below the FDIC limit, you shouldn't have to worry about losing money. The main concern would be if a new bank that takes over after Hanmi's closure would honor existing CD rates. If they don't, you would be free to take an early withdrawal without a penalty.

Installment Savings Account

If you don't mind the above risk, Hanmi Bank does continue to have some good deposit deals for those in California. The best is their Prime Installment Savings Account which continues to offer very competitive rates. As of 11/11/2009, Hanmi lists rates ranging from 4.34% APY for a 12-month term to 5.65% APY for a 5-year term, and readers have reported an extra 25 basis points when you have auto transfer.

Installment savings account rates should not be directly compared to CD rates or regular savings account rates. The installment savings account requires that you make monthly deposits during the term. The deposits earn a guaranteed interest rate, and you'll receive the contract amount at maturity if you maintain the monthly deposits. I have more details about Hanmi's installment savings account in this previous post. I have details about how you can compare installment savings account with CDs in this post. A quick way to come up with a rough idea of how an installment account compares to a CD is to take the average of the installment account rate and the rate of a liquid account. The initial lump sum would go into this liquid account, and the monthly deposits would be transferred from this to the installment account. Here's an example:

1.00% APY in the liquid account (assumes 1% will be the average rate of liquid account during the term of the installment account)
4.60% APY in the 1-year installment account (assumes 0.25% bonus for auto transfer)
Estimate for combined APY = (1.00% + 4.60%)/2 = 2.80% APY

Internet CD Rates

In addition to installment savings account, Hanmi Bank continues to offer some decent deals on its internet CDs. The two most competitive ones as listed at Hanmi's internet products page and include a 2.02% APY 12-month CD and a 1.87% APY 9-month CD as of 11/11/2009. These can be opened online, but you have to be a California resident.

Checking Account Bonus

There's also a checking account promotion in which you can earn up to $70 with direct deposit and by making online bill payments.

Hanmi Bank has been a FDIC member since 1982 (FDIC Certificate # 24170).

Other Installment Savings Accounts

To find other installment savings accounts, refer to my Installment Savings Account Page. Be sure to check with the bank for the latest rates. If you've found any other bank offering an installment savings account, please leave a comment.
Comments
Anonymous
Anonymous   |     |   Comment #1
Looks like Hanmi needs a bailout. Some of that money going to all of the other online banks need to be redirected to Hanmi.
Anonymous
Anonymous   |     |   Comment #2
Why go through all the hassle only to wait for the FDIC to move in and another bank to take over? Sounds like a waste of time.
Anonymous
Anonymous   |     |   Comment #3
I was going open an account with Hamni last summer as they had some good internet rates. The problem I ran across was the phone customer service agents were hard to reach, hard to understand and could not answer simple questions. I live near a branch and stopped by to if they could assist me with some of the questions I had about one of the accounts. I notice when I was at their office that it appeared that they could care less if I opened an account with them, (not friendly). Finally one of the agents ask me what I needed. I told her that I was looking at one of Hamni’s savings accounts that was on the internet. As soon as she heard the word internet, her conversation was over with me. She stated that the Hamni branch offices don’t deal with these accounts. After losing 2 to 3 hours trying to find out some information on the account, I gave up. As I left I had this gut feeling that I had just dodged a bullet and was glad that I was not tangled up with these guys.
Anonymous
Anonymous   |     |   Comment #4
Something also to remember is that when banks are seized and sold to another institution you regularly will lose the interest payment on CDs and high yield deposit accounts. You initial deposit will be safe if under the FDIC limits but your interest is not usually covered and paid out by the Fed or the acquiring institution.
Anonymous
Anonymous   |     |   Comment #5
Anonymous @ 6:12 -

Nope. The TOTAL amount of deposits (principal + interest), that has accrued up until the day of the bank failure, is completely insured.

http://www.fdic.gov/consumers/banking/facts/index.html
Anonymous
Anonymous   |     |   Comment #6
they were a little slow in Irvine office when I opened up an installment account in last May. The rate was great and there was no max limit. Till July 2010, about 9 more months are left.
btw, the interest earned is also insured.
Anonymous
Anonymous   |     |   Comment #7
I have opened several accounts at their office in Santa Clara. They are very helpful and friendly and easy to do business with. The most informed person at this branch handles all new accounts. If you deal with her you will be satisfied.
Anonymous
Anonymous   |     |   Comment #8
So far so good at SF near Japanese Town. Thanks!
Anonymous
Anonymous   |     |   Comment #9
Rates went down. 3.77% for 12 month now.
Anonymous
Anonymous   |     |   Comment #10
They are going down. The writing is on the wall. This bank is a joke as they are clueless as what is about to happen to them.
Anonymous
Anonymous   |     |   Comment #11
Rates now 3.50% for 12 month. Of course when I opened an account their website still said 3.70%, and the worker even brought it up on her screen. But they changed the rate that day, and now it shows correctly. They aren't that friendly to non-Koreans. Hate to say it, but true.
Quovatis
Quovatis   |     |   Comment #12
All info on the installment savings seems to be gone on the website.  The link is there, but nothing loads.
Installment Savings Account with High Rates at Hanmi Bank - CA Only
Hanmi Bank is offering some competitive rates on its Prime Installment Savings Account. The yields range from 4.34% APY for a 12-month term to 5.65% APY for a 60-month term. Below is the full list of rates as listed at the bank's Prime Installment Savings Page as of 5/05/09:
  • 4.34% APY 12-month
  • 4.34% APY 18-month
  • 4.86% APY 24-month
  • 4.86% APY 30-month
  • 5.13% APY 36-month
  • 5.39% APY 48-month
  • 5.65% APY 60-month
I was concerned that the rates may be out-of-date since there's an August effective date. I just called the bank, and I confirmed these rates are still available....
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2.02% Reward Checking Account at a California Bank (Hanmi)
Update 7/18/09: The top yield has fallen to 2.02% APY. Rate history is available at bottom of post.

Hanmi Bank is offering a reward checking account called Bonus Checking that pays 2.02% APY on balances up to $25,000 (1.00% for above) and refunds ATM fees if the following monthly requirements are met: 1) 10 debit card transactions, 2) one direct deposit, 3) receive e-statements, and 4) maintain a valid email address on file with the bank. If these are not met, the rate falls to 0.05%. The minimum opening deposit is...

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2.81% 6-Month CD & 2.60% 12-Month CD at Hanmi Bank in California - Local Only
Update 6/16/09: The 2.81% CD appears to be over, but according to an Irvine branch CSR yesterday, they still have a 2.70% APY 12-month CD. Please contact Hanmi Bank for the latest CD rates.

Hanmi Bank is offering some competitive CD rates at its branches. These rates don't seem to be listed at the bank's website. A reader emailed me info on these, and I just called for additional info. I'm afraid I had a little trouble understanding the CSR, so I called two other branches. I was told slightly different...

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4.20% 6-Month CD and Other High Rates at Hanmi Bank in California
Update 1/24/09: The 6-month Freedom CD rate has fallen to 3.43% APY.

Hanmi Bank is offering a 4.20% APY 6-month CD. It's called Freedom CD Plus. It allows up to 3 partial withdrawals during the term without penalty. It also allows unlimited deposits through the term in increments of $1,000. Minimum deposit is $10,000. Maximum deposit is $1 million. The rate is listed at the bank's Freedom CD Plus Page as of 1/07/09. It's also being advertised on the bank's home page.

I just called the bank, and I was told that...



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4.08% Short-Term Internet CDs Continue at Hanmi Bank - California Only
Update 3/11/09: The internet CD rates are now posted at this CD rate table. New APY's: 1.76% 3mo, 2.02% 6mo, 2.53% 9mo and 2.79% 12mo.

Update 1/26/09: New internet CD rates are posted at the bank's internet CD rate page. All terms (3, 6, 9 and 12 months) have a rate of 3.50%.

Hanmi Bank recently lowered the rate on its 6-month Freedom Plus CD from 4.20% to 3.43% APY. However, it is still listing internet CDs with an APY of 4.08% for terms of 3, 6 and 9 months. Minimum deposit...



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