Northern Bank Direct Ups Promo Rate On Existing Money Market Accounts
Good news for those who took advantage of Northern Bank Direct’s (NBD) Money Market Account promotion last June: balances up to $250k now earn 2.50% APY, with a rate guarantee through June 30, 2019.
If you missed last June’s offering, here’s a brief synopsis: new Money Market Accounts opened between June 8 and 18, 2018 ($5k minimum deposit) were guaranteed to earn 2.26% APY on balances up to $250k through the end of June 2019.
In a Forum post yesterday, DA reader, Sperry8, relayed the contents of an email NBD sent to existing promotional Money Market Account customers. Below is a portion of that email.
Is there anything better than watching your Northern Bank Direct Money Market Account grow? What about an increased interest rate?
Well, we're giving you both! Because you're a valued and loyal customer, we have increased your interest rate to 2.47% with a 2.50% APY for balances up to $250,000.00.
Your interest rate and APY are accurate as of January 28, 2019 and guaranteed through June 30, 2019. After June 30, 2019 your interest rate and APY may change as this is a variable rate account.
The APY for the balance portion between $250k and $1 million continues to earn 0.75% APY, with the portion of the balance over $1 million earning 0.01%. This results in a blended APY.
While the outlook for the next six months for existing promotional Money Market Accounts is rather rosy, current NBD rates don’t bode well following the end of the promotion period. As of today, the rate for the non-promotional Money Market Account is only 1.51% APY on balances up to $250k. NBD’s current CD rates don’t inspire a lot of confidence either, with rates ranging from 1.50% APY (12-month CD) to 2.57% APY (60-month CD). Enjoy the next six months, but have an exit plan in place, just in case.
Availability
As the internet division of Massachusetts' Northern Bank, Northern Bank Direct offers its services and product line nationwide only online. Since the promotional rate is only available to existing Money Market Accounts, information about opening an account is moot. Should the availability change, I will let you know.
Bank Overview
As the online division of Massachusetts-based Northern Bank, Northern Bank Direct operates under the Bank’s FDIC Certificate and shares its financial history.
Northern Bank/Northern Bank Direct has an overall health grade of “A” at DepositAccounts.com, with a Texas Ratio of 9.66% (excellent), based on September 30, 2019 data. In the past year, the Bank has increased its total non-brokered deposits by $426.89 million, an excellent annual growth rate of 37.14%. Please refer to our financial overview of Northern Bank/Northern Bank Direct (FDIC Certificate # 18266) for more details.
While Northern Bank Direct is a new institution, Northern Bank is not. Established in 1960 by brothers Jim and Thomas Mawn, it's the largest privately-held, family-run, full-service bank in Massachusetts. In 59 years, Northern Bank has grown to become 22nd largest bank in the state, with assets in excess of $2.14 billion and more than 33,200 customer accounts. From 2010 to 2017, Northern Bank was rated by the S&P Global Market Intelligence Ratings as the top New England bank with assets of $500 million to $5 billion.
How the Money Market Account Promo Compares
When compared to the nationally available Money Market Accounts and Savings Accounts tracked by DepositAccounts.com, Northern Bank Direct's Money Market Account promotional APY currently ranks first, regardless of deposit requirements.
| Interest Rate | Account Name | Credit Union/Bank |
|---|---|---|
| 2.50% APY | Money Market Account (no min/$250k max) | Northern Bank Direct |
| 2.45% APY | Savings Builder w/monthly deposit (no min/no max) | CIT Bank |
| 2.45% APY | UFB Premium Money Market ($25k min/no max) | Virtual Bank |
| 2.41% APY | Money Market Account (no min/no max) | earn.bank |
The above rates are accurate as of 1/29/2019.
Looking for the best Money Market Account rates, either nationwide or state specific? Please refer to our Money Market Account Rates Table page.
So if the Fed raises in June, this rate should stay or go higher..?
2.5% APY is a good interest rate, NBD has been a good bank, and I like the rate guarantee a whole lot.
I hope they continue to offer a top MMA rate for a long time for existing customers. Couldn't care less if they open it to newbies or not.
I expect when their 2.26% rate became less attractive by comparison, they lost some funds from a lot of customers and they knew they would get a certain amount back by raising the rate. In the end, any bank or CUs rates depend on THEIR NEEDs, they are not paying high rates to create goodwill for no reason.
From NBD's perspective, their decision to raise rates for existing accounts yet almost discourage new accounts (via much lower rates), may say more about their desire to retain existing accountholder funds while also not gathering a lot more new funding (from new accounts), than it does about their view on the future direction of rates. NBD may simply not have enough places to loan a large influx of new funds profitably, and therefore may not want them. Although existing accounts are not limited to $250K the higher rate of interest is paid only to $250K, therefore by limiting the increase to existing accounts NBD has somewhat of a control over the upper limit of principle on which higher interest must be paid.
I appreciate the increase and just because it's only guaranteed through june does NOT mean they will automatically decrease it to 1.51%.
A poster elsewhere on here was talking about what's the big deal about 2.5%.
Its 13.6% more than Ally pays and since I already have an account with northern, no extra paperwork or accounts to be opened.
And, I think I have some checks of theirs buried somewhere in my clutter.
I read elsewhere here that Northern is aware that many accounts are showing a different rate and they are working on correcting it.
I think yesterday mine showed 2.37% while others reported less.
I dropped a check in the mail yesterday which will remove virtually all my remaining funds from Ally.
I am keeping the Ally account open because its a great hub and because their website is probably the best of any bank or CU I have used.
And, maybe they have another 1% bonus deal again which requires outside money.
I never opened an EBSB account because at the time, I did not have even $5k available. Now I do with more coming available next week.
You might want to do a bit more due diligence.
The Fed GENERALLY doesn't actually RAISE or LOWER anything at a January meeting. Historically, speaking.
'Hints' are worthless as far as I'm concerned ....the Fed can change course on a dime.
Last year is not a historical look at the Fed. You should educate yourself on how the Fed operates, not just repeat what happened last year.
In the years prior to the Financial crisis, they went about things quite differently.....
...up to and including a few of their "emergency meetings".
Thank you for your email!
The rate chnage online will chnage on your next statement cycle.
I had 2 identical accounts, the 2nd one is now closed but when it went below a certain amount, it charged me a small service charge. When I emailed the rep, she said their system charged me as if I had a different account but corrected it. I opened the 2nd account because they had a $250k limit per account for the high rate.
Both accounts were paying the 2.26% from before I believe.
I don't recall my exact date of opening but it was for the 2.26%. If you joined for that rate, I would think you are eligible too unless they someone only offered it to some which makes little sense.
I closed the 2nd account because I did not envision them raising the rate and me going over the $250k limit. But they did. Still, I am staying below $250k this time.
As of the end of the year, the "promo" account was earning 2.25% and the older account was earning 1.51%. I only had small amounts in each to keep the accounts open in case they ever raised the rate.
When I asked for the new rate, I mentioned that I'd transfer large amounts back in if they gave me the 2.50% rate, but no luck.