The 12-month CD Special offered by the State Bank of Texas (SBT) is currently near the top of the nationally available 1-year CD category in this week’s CD Deals Summary. Following a recent 10-bps increase, the 12-month CD Special now earns 5.85% APY ($50k minimum). For deposits of $25k to below $50k, the CD Special earns 5.25% APY. The 12-month CD Special has been part of the SBT product line intermittently for about the past two years, requiring a variety of minimum opening deposits, ranging from $25k to $250k.
The 12-month CD Special made its debut in December 2021 offering 0.85% APY, which was a competitive rate at the time. Since that time, DA has tracked a total of 20 rates increases, adding an impressive 500 bps.
Headquartered in Dallas, State Bank of Texas has been offering a variety of CDs on a nationwide basis for about six years. The only nationally available CD currently offered is the 12-month CD Special.
The first page of the online application reads,
Please note that you must be 18 years of age and classified as a US Person to apply online.
According to the IRS definition of U.S. Persons, the following are eligible to open a 12-month CD:
- 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.
In addition to opening a CD Special online, a CD Special can be opened at any of five Texas branches located in Dallas, Garland, Houston, Irving, and Richardson, or the single full-service Illinois branch located on Chicago’s North Side.
While SBT has seven brick-and-mortar branches 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.
Funding and Other Particulars
The following information is from a conversation with CSR.
- Funding – ACH transfer, wire, or check.
- Ownership – Individual, joint, or trust.
- Early Withdrawal Penalty – 60 days interest; early closure only.
- Interest – Credited monthly and distributed by ACH to a checking account at any bank, or deposited back into the CD Special at maturity. No compounding.
- Maturing Funds – ACH ($10 fee), wire transfer ($30 fee), cashier’s check to the address on file, or transferred to another SBT account.
- Grace Period – 10 calendar days before automatic renewal.
- Beneficiaries – unlimited, equal shares, Social Security numbers required.
- Credit Check – ChexSystems
State Bank of Texas has an overall health grade of "A+" at DepositAccounts.com, with a Texas Ratio of 2.13% (excellent) based on June 30, 2023 data. In the past year, SBT has increased its total non-brokered deposits by $463.6 million, an excellent annual growth rate of 37.87%. Please refer to our financial overview of State Bank of Texas (FDIC Certificate # 27074) for more details.
Founded in 1987, State Bank of Texas continues to be 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.
In the past 11 years, SBT acquired Millennium State Bank of Texas, National Republic Bank of Chicago, and Seaway Bank and Trust Company, becoming the largest Indian-American owned bank in the country. SBT is currently the 48th largest bank headquartered in Texas with assets of nearly $2.9 billion and more than. $1.8 billion in deposits.
How the 12-Month CD Special Compares
When compared to similar length-of-term CDs tracked by DepositAccounts.com which are available nationwide, have a fixed rate, and require a minimum deposit of $50k or less, one credit union has a higher rate than currently offered on the SBT 12-Month CD Special. The following table compares the 12-Month CD Special to the two highest-rate CDs from other banks and the two highest-rate CDs from credit unions.
|APY||CD Term (Early Withdrawal Penalty)||Credit Union/Bank|
|6.18%||12-Month Share Certificate Special, $100 min/$100k max (EWP=lesser of 3 months or all earned dividends)||Bayer Heritage Federal Credit Union|
|5.85%||12-Month CD Special, $50k min (EWP=60 days)||State Bank of Texas|
|5.77%||11-Month CD Special, $10k min (EWP=all earned interest)||West Town Bank & Trust|
|5.76%||13-month Simple CD Special, $500 min (EWP=50% of potential dividends)||Dow Credit Union|
|5.70%||14-Month CD, $50k min (EWP=6 months)||Finworth|
The above information and rates are accurate as of 11/24/2023.
To look for the best CD rates, both nationwide and state specific, please refer to our CD Rates Table page.