Missouri-based Neighbors Bank has added a nationally available High Yield Online Savings (HYOS) account to its product line. Balances of $25k+ currently earn 1.70% APY, with balances of less than $25k earning 1.00% APY. I was hoping to see some type of rate guarantee to make this new product very competitive, but there is none.
Funding and Accessing the HYOS
The initial deposit (minimum $25) must be made by either debit card or check (a check requires a mobile app download and is limited to a maximum of $10k). After the account is established, deposits can be made through remote check deposit using a mobile device, wire transfers, or online transfers (ACH). ACH transactions for a new account are limited to $10k per day, but will be increased to $250k per day and $1 million per month within two months. The hold time for an incoming ACH is between 1 and 2 business days. Unlimited external bank accounts can be linked. ACH deposits/withdrawals can be initiated from another bank without dollar limits.
Like most online savings accounts, there's no ATM/debit card or check writing available. Any withdrawals must be made through ACH or by requesting a cashier’s check.
The Truth-in-Savings disclosure and FAQs provide all kinds of useful information including,
The maximum balance allowed in your Account is $250,000. You will be precluded from adding funds to the Account once the balance reaches $250,000. Interest earned will not count towards your maximum balance allowed. If your Online Savings Account was opened prior to May 6, 2020, you will be “grandfathered” in and allowed to keep an excess of $250,000 in your account.
Compounding and crediting frequency - Interest will be compounded every month. Interest will be credited to your account every month.
Effect of closing an account - If you close your account before interest is credited, you will not receive the accrued interest.
While there is no monthly maintenance fee or fees for incoming wire transfers, there are a couple of possible charges to be aware of:
- $5 excessive transaction fee for each withdrawal in excess of six per statement cycle.
- $2 for each copy of a statement requested.
- $20 for an outgoing wire and $1 per telephone transfer.
Unlimited beneficiaries can be named, but must be added after the High Yield Online Savings account is opened, using Neighbors Bank’s Online Banking platform. Social Security numbers are required for all beneficiaries and percentages can be assigned.
Headquartered in Columbia, Missouri, Neighbors Bank describes itself as “primarily an online bank with only one physical location in Missouri.” Citizens and legal permanent residents of the United States, 18 years or older, with a valid Social Security number and a U.S. physical street address are eligible to open an account. (The fine print on the landing page states “Not available in Delaware.”)
Opening a High Yield Online Savings account can be done online. According to the FAQs page (and CSR), there should be no hard credit pull that can ding your score.
Why do you ask personal questions to verify my application?
This won't impact your credit score
This is a small bank with only one branch, 49 employees, and only $31.6M in assets, but Customer Support is available 24/7, with a live CSR available at all times. It's quite possible the Bank may quickly reach its deposit goals and then lower the HYOS rate to an uncompetitive level. Caveat emptor.
Neighbors Bank has an overall health grade of "B+" at DepositAccounts.com, with a Texas Ratio of 0.42% (excellent) based on December 31, 2019 data. In the past year, the Bank increased its total non-brokered deposits by $4.15 million, an excellent annual growth rate of 18.37%. Please refer to our financial overview of Neighbors Bank (FDIC Certificate # 16247) for more details.
Neighbors Bank was established in 1945 as the Clarence State Bank, with a market area covering three northeast Missouri counties. Owned and operated by the Schoonover family for over 70 years, the Bank reorganized in 2016, joining the Columbia, Missouri-based bank holding company, Columbia Bancshares, Inc. The “Neighbors” rebrand occurred in 2018.
How the High Yield Online Savings Compares
When compared to the nationally available Savings Accounts tracked by DepositAccounts.com, Neighbor’s Bank’s High Yield Online Savings APY currently ranks second, regardless of minimum balance requirments.
The above rates are accurate as of 5/13/2020.
To search for the best Savings Account, both nationwide and state specific, please refer to DepositAccounts.com’s Savings Account Rates page.