3.75% 7-Month CD & 3.85% 13-Month CD at Greater Atlantic Bank in MD & VA

This is a small community bank based in the Maryland and Virginia area. I recalled that they had a branch office in downtown Washington DC many years ago. Most people never heard of this bank and I am sure very few people opened accounts there (they used to advertise in the local DC paper) and the branch office was later closed. If you decide to deposit money there, I would advise you to don't go above the FDIC coverage limits.

The following article explains the likely reason for these sudden high rates:

http://www.bizjournals.com/washington/stories/2008/12/15/daily47.html

GAB was scheduled to be bought out by a more financially sound competitor, but after GAB suffered major losses this year, the merger agreement was terminated.

I agree that it would be wise to remain below the FDIC coverage limits, as would be true at any bank.

Signed, a real live former depositor of GAB

Wow. Someone who actually was a customer of GAB? I guess the eagle logo reeled in you in? I recalled that they did offer competitive rates when compared to the other banking institutions in downtown DC such as Citibank, Riggs Bank, SunTrust, etc. But I saw that the bank was based in the Eastern Shore of MD and if that branch office in downtown DC shut down (which it did), then it would be inconvenient to continue to do business with them. Though community banks tend to operate in a more safe manner than the big banks, I have been somewhat hesitant to leave any significant amount of money with small banks that have few customers.

Yes, I was a customer for several years - had my main checking account with them for a while. Their remaining MD branch (Rockville) was near my office.

The people in the branch were very friendly, but there were never any other customers. I truly don't know how they remain in business.

I know what you mean. There is a small bank called Suburban Savings right on the main road from my home and when I drive by, I never see any cars in the parking lot on any given day. I guess they must earn their business through local people who live nearby and to people who need auto loans or mortgages. I also had an account in American Savings Bank in Rockville, MD that I closed recently. They offered pretty good rates back in the 1990's and I finally closed out the account in 2003 when rates nosedived across the US. The rep wasn't pleased that I was closing the account and wanted to know why. I didn't want to hurt her feelings by saying "your bank savings rates are abysmal", so I just lied and said I was moving out from the area.