Competitive Jumbo Money Market Account at State Bank of Texas
Thanks to a comment made by DA reader, keke2die4, the Jumbo Money Market offered by State Bank of Texas’ (SBT) was added to this week’s Liquid Summary. The Jumbo Money Market currently earns 0.75% APY on balances of at least $100k.
The Jumbo Money Market has seen a variety of changes between 2016 and 2017. In early 2016, the Jumbo Money Market (known then as Jumbo MMDA) was only available in Chicago. A few months later, it was offered nationwide, then withdrawn completely for a short time, and then reinstated as a nationally available product in the fall of 2016. The nationwide availability last for about a year before it was once again removed from the product line in October 2017. At some point, the Jumbo MMDA was brought back (rebranded as Jumbo Money Market) with its nationwide availability reinstated.
Note: DA’s Rate Histories can be deceptive at times, because any gaps in availability aren’t reflected in the graphics. What looks like ten years of continuous availability for the Jumbo Money Market isn’t 100% accurate.
The Jumbo Money Market is a fairly straightforward account, with no unusual conditions or requirements. According to SBT’s Personal Money Market page,
- Minimum opening deposit is $100k.
- Minimum balance of $100k required to earn the stated rate and no interest will be paid if balance falls below $100k.
- Monthly maintenance fee of $20 if the average daily balance falls below $25k.
- $25 fee for each addition debit beyond the allowed six per statement cycle.
Funding a Jumbo Money Market account can be done by ACH, wire, or check. According to CSR, there are no daily/weekly/monthly dollar amount limitations on ACH transfers. Unlimited beneficiaries can be added, with a Social Security/Tax Identification number required for each beneficiary.
12-Month CD
In the past few years, State Bank of Texas (SBT) has been periodically offering nationally available special rate CDs. The only CD currently available nationwide is a 12-month CD earning 0.55% APY ($25k) and 0.65% APY ($100k). Frankly, these APYs are not all that special. Back in April, SBT was offering an additional 20 bps for residents of Harris County (and its seven contiguous counties), but that bonus rate is no longer available.
| APY | MIN | MAX | INSTITUTION | PRODUCT | DETAILS |
|---|---|---|---|---|---|
| 0.65*% | $100k | $250k | State Bank of Texas (SBT) | 12 Month CD | |
| OTHER TIERS: 0.55% → $25k - $100k | |||||
According to CSR, the Early Withdrawal Penalty for the 12-month CD is 30 days of interest.
Funding the 12-month CD can be done by ACH transfer, wire, or checking. Monthly interest can be paid via ACH to a checking account at any bank. Maturing funds can be distributed by ACH, cashier’s check to the address on file, wire, or transferred to another SBT account.
Availability
Headquartered in Dallas, State Bank of Texas’ primary market area includes the Dallas metropolitan area and the Chicago metropolitan area, but the Jumbo Money Market is available nationwide to all “U.S. Persons” with a valid Social Security number or Tax Identification number through an online application.
According to the IRS definition of U.S. Persons, the following are eligible to open a Jumbo Money Market account:
- A citizen or resident of the United States
- A domestic partnership
- A domestic corporation
- Any estate other than a foreign estate
- Any trust if: a court within the United States is able to exercise primary supervision over the administration of the trust, and one or more United States persons have the authority to control all substantial decisions of the trust
- Any other person that is not a foreign person.
Opening a Jumbo Money Market can be done online, or in person at any of the four Texas branches located in Dallas, Garland, Houston, Irving, and Richardson, or the sole full-service Illinois branch located on Chicago’s North Side.
While SBT has a presence at Chicago’s Midway and O’Hare airports, the vast majority of those “branches” are kiosks that only offer currency exchange services. The one exception is the O’Hare location in Terminal 5, on the Lower Level outside of security next to arrivals. No airline ticket is required for entry to the Terminal 5 location.
Bank Overview
State Bank of Texas has an overall health grade of "A" at DepositAccounts.com, with a Texas Ratio of 7.08% (excellent) based on March 31, 2021 data. In the past year, SBT has increased its total non-brokered deposits by $20.13 million, an above average annual growth rate of 2.79%. Please refer to our financial overview of State Bank of Texas (FDIC Certificate # 27074) for more details.
Thirty years after opening its doors for business, State Bank of Texas is still a family-owned and operated bank. After 20 years in the hotel industry, SBT’s founder, Chan Patel, set out to create a bank for the immigrant community, particularly those in the hospitality industry. At the time, $2 million of capital was required to start a bank; Patel had $1 million of his own to invest but needed to find investors for the remaining $1 million. Using the novel approach of offering a lifetime career as a professional banker and a Director’s position in exchange for a $100K investment, Patel raised the monies within two weeks.
SBT is currently the 83rd largest bank headquartered in Texas, with assets in excess of $1 billion. Beginning in 1990, SBT acquired two Texas banks and two Illinois banks, the most recent acquisition being Chicago-based Seaway Bank and Trust Company in 2017.
How the Jumbo Money Market Compares
When compared to the Money Market Accounts tracked by DepositAccounts.com that are available nationwide and require a large minimum balance, State Bank of Texas’ Jumbo Money Market APY currently ranks second.
The above information and rates are accurate as of 8/7/2021.
To look for the best Money Market Account rates, both nationwide and state specific, please refer to our Money Market Account rates table page.
This is almost too good to be true and is not my experience with the Jumbo MMA, which I opened last week.
I have spoken with several SBT employees and each of them cited the same transfer limits (below) right off the top of their head.
The online banking disclosure document states, with respect to transfers ”There are limits on the amount of money you can send or receive through our Account to Account Transfer Service. Your limits may be adjusted from time-to-time in our sole discretion. You may have the ability to log in to the Site to view your individual transaction limits “
I could not find any discussion of limits on the SBT website or the transfer screen within online banking, so I proceeded to initiate an incoming transfer from one of my linked external financial institutions (using the SBT online transfer feature). My transfer was blocked for exceeding the transfer limits and I then was able to access a drop down menu on the transfer screen that informed me the limits are:
Incoming: $15,000 per transfer and $30,000 per month
Outgoing: $5,000 per transfer and $10,000 per month
Then, I called the bank to ask about exceptions.
First, it was clarified that there are no limits if the ACH transfer is initiated at the funding institution. This must have been what caused the response to DA (above).
There are no exceptions granted to the limits (above) applied to transactions initiated at the SBT online banking site.
However, there is a work around which is to request a one time ACH transfer. This involves contacting the bank and getting an authorization form to fill out (this can be transmitted both ways by email) AND involves a $10 fee.