LendingClub Bank Ups High-Yield Savings Rate
The fintech company that was a leader in peer-to-peer lending has become an FDIC-insured bank called LendingClub Bank N.A. (LendingClub) after its acquisition of Massachusetts-based Radius Bank. LendingClub ended its peer-to-peer Notes program, and it’s now promoting high-yield savings accounts. LendingClub appears intent on being a competitive online bank. It recently made a significant rate upgrade to the old Radius Bank High-Yield Savings account, bringing the account back to a competitive level. LendingClub raised the High-Yield Savings rate to 0.60% APY on balances =$2.5k; balances <$2.5k earn 0.05% APY. The fee-free High-Yield Savings account can be opened with a $100 minimum deposit.
If you look at the drop-down box listed under “Details,” it looks like the High-Yield Savings is a new account, as of July 2020. Unfortunately, the software that tracks rates considers accounts that are part of an acquisition to be new accounts offered by the acquiring financial institution. In other words, the rate history goes back only as far as the acquisition date.
Between 2015-2018, I wrote four blog posts about the Radius High-Yield Savings account. The last blog post was in September 2018 when it offered rates of 1.96% APY ($25k+), 1.50% APY ($2.5k+), and 0.05% APY ($10+). By the end of 2018, the top tier rate had been increased to 2.05% APY, a rate that remained in effect for about a year. In December 2019, the top tier rate dropped to 1.65% APY, but the High-Yield Savings account was removed from the bi-weekly Liquid in March 2020, after the rate had plummeted to 0.25% APY.
The High Yield Savings FAQs page contains some helpful information, including,
How do I fund my account and when are funds available?
To make your initial deposit, you can transfer money from your account at another financial institution using your account and routing number or your debit card. Please ensure that you have sufficient funds available to be transferred. All funds transferred into your account during the first 30 days of your account being opened are held for 5 days for your security, with the exception of direct deposit from your employer which is available immediately upon deposit.
Where can I deposit my cash?
You are able to deposit cash at any MoneyPass Deposit Taking ATMs and NYCE Shared Deposit ATMs and we rebate all ATM fees at the end of the month.
A free ATM card is available and can be used at fee-free ATMs across the country.
LendingClub is a member of two nationwide surcharge-free ATM networks: MoneyPass® and SUMSM. You can use your debit and ATM cards at any of the more than 20,000 ATMs without incurring an ATM surcharge.
What’s no longer included in the FAQs or the Truth-in-Savings disclosure is the answer to that all-important question, “Can I make External Transfers online?” In a Live Chat, CSR confirmed that the following is still in effect:
Yes. As a Radius Bank customer enrolled in Online Banking, you can make free internal and external transfers. This includes transferring money between your Radius Bank accounts, transferring money to other Radius Bank Online Banking account holders, transferring money from your Radius Bank account to accounts at other financial institutions, and transferring money from accounts at other financial institutions into your Radius Bank account. The standard daily limit for online external transfers is $5,000 incoming and $5,000 outgoing.
I had hoped the daily limits had been increased since my last blog post, but they have remained unchanged. CSR stated that ACH transfers initiated from an outside bank are allowed, “as long as you are the owner of both accounts.” When ACH limits are low, it’s always good to have another way to move funds in and out that’s free.
CSR also stated that two beneficiaries (equal shares) can be named with Social Security number, date of birth and full address required.
Headquartered in Boston, LendingClub Bank offers its services and product line to all U.S. citizens and resident aliens, 18 years or older, who have a valid Social Security number or Individual Tax Identification number.
Accounts, including the High-Yield Savings, can be opened online, through a Live Chat on LendingClub's website, or at the Seaport Financial Center on Harbor Street in Boston.
Our Seaport Financial Center is now open to the public without an appointment needed.
LendingClub Bank has an overall health grade of "A+" at DepositAccounts.com, with a Texas Ratio of 2.56% (excellent) based on June 30, 2021 data. In the past year, LendingClub has increased its total non-brokered deposits by $978.48 million, an excellent annual growth rate of 92.21%. Please refer to our financial overview of LendingClub (FDIC Certificate # 32551) for more details.
LendingClub Bank is currently the 17th largest bank headquartered in Massachusetts and the 323rd largest bank in the country, with assets in excess of $3.3 billion and more than 70,000 customer accounts. Established in 1987 as the First Trade Union Savings Bank, FSB, the Bank has rebranded three times: First Trade Union Bank (1996), Radius Bank (2014), and LendingClub Bank, N.A. (2021) following the 2020 acquisition of Radius Bank. As stated on LendingClub’s About Us page,
On February 1, 2021, LendingClub Bank, N.A., closed the acquisition of Radius Bancorp and its wholly-owned subsidiary, Radius Bank, becoming the only full-spectrum financial technology (fintech) marketplace bank and the first public U.S. neobank. As of July 14, 2021, Radius officially updated its brand name to LendingClub.
How the High-Yield Savings Compares
When compared to the nationally available Savings Accounts tracked by DepositAccounts.com that do not have a low balance cap or large minimum balance requirement, LendingClub Bank’s High-Yield Savings APY currently ranks third.
The above information and rates are accurate as of 9/17/2021.
To search for the best Savings account rates, either nationwide or state specific, please refer to our Savings Accounts Rates Table page.
I've had a trust account opened at Radius for many years. Now with almost nothing in it since I took the money out when they stopped being competitive.
Now the account is with LengingClub.
I have a very large balance for this trust sitting in another FDIC insured account elsewhere at 0.55%. A step up to 0.60% is probably not worth it although it would be no hassle since the account is already open and there would be no transaction cost. But without a rate guarantee, I am not inclined to make the change since rate chasing often proves to be a bad practice.
I am still intrigued by differences in the health ratings of banks across sites however and this bank is a good example. As is often the case, DA gives this bank a much higher health rating than Weiss. DA gives it an A+ and Weiss gives it a C.
What is most puzzling though is the differences in what should be identical calculations.
DA shows Return on Assets at 0.82% and Weiss shows 0.76%
DA shows Return on Equity at 7.02% and Weiss shows 6.66%
Both are showing that they are using Q2 2021 data.
I understand from my own experience that there can be different methods of calculations for arriving at some numbers. But typically, these two figures should be identical if they are derived from the same financials.
Since I am not clear on what methodologies are used, and there doesn't seem to be consistency across public sites, I don't put a lot of faith in these health ratings. I do, however, get some value from seeing the raw data which is provided for some of the import metrics such as total amount of deposits and loans.
By the way, the transfer limits using Lender's Club system grows over the first few months quite a huge amount...(see chart from their website)
And the 5 day transfer hold when you use their system only applies for the first 30 days then it is removed...same is true with deposited checks...