Synchrony Bank Offers Competitive 19-Month CD Special

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Deal Summary: 19-month CD Special (2.65% APY)

Availability: Nationwide

Last Wednesday, Synchrony Bank launched a new 19-month CD Special with a competitive rate (2.65% APY). It’s the latest CD Special that Synchrony has introduced this year. Three months ago, Synchrony Bank introduced a 16-month CD Special with a 1.50% APY, which was competitive at that time. This Special 19-month CD competes with Ally Bank’s 20-month Select CD. Synchrony is also trying to compete with two new CDs that it introduced in May (an 11-month No Penalty CD and a 2-year Bump Up CD) which have the same features as Ally’s 11-month No Penalty CD and 2-year Raise Your Rate CD.

APYMINMAXINSTITUTIONPRODUCTDETAILS
3.30%--Synchrony Bank19 Month CD
Rates as of October 2, 2022.

The minimum deposit for Synchrony CDs and IRA CDs used to be $2,000, but it’s now $0. Unlike Synchrony’s standard CDs, this 19-month CD Special is not available as an IRA.

Synchrony Bank’s CD rates have been in the high range for the major online banks this year as rates have risen. The following table provides the current yields of noteworthy standard CDs. Click on the “details” arrow to display the CD rate history and other details. For the full list of Synchrony Bank deposit rates, please refer to the rates section of our Synchrony Bank page.

APYMINMAXINSTITUTIONPRODUCTDETAILS
3.61%--Synchrony Bank60 Month CD
3.50%--Synchrony Bank36 Month CD
3.15%--Synchrony Bank12 Month CD
Rates as of October 2, 2022.

Synchrony Savings and Money Market Accounts

Like Synchrony Bank’s CD rates, Synchrony’s High Yield Savings account rates have been in the high range for the major online banks this year as rates have risen. However, its savings account rate has been well under the rate leaders, which have been a few of the smaller online banks.

The High Yield Savings had its first rate hike in 2022 on March 8th when the yield increased from 0.50% to 0.60%. Three additional rate hikes in May, June and July have increased the yield to 1.40%. The yield reached a bottom of 0.40% in the first half of 2021. That lasted less than two months. The yield increased to 0.50% in May 2021 and remained at that level until last March.

Synchrony Bank has also been increasing the rate of its Money Market account, but the rate increases have been smaller than the High Yield Savings rate increases. Since 2013, the High Yield Savings account has maintained higher rates than the Money Market. The difference was the largest in 2019 when the High Yield Savings yield peaked at 2.25% while the Money Market yield peaked at only 1.20%.

APYMINMAXINSTITUTIONPRODUCTDETAILS
2.25*%--Synchrony BankHigh Yield Savings
1.60*%--Synchrony BankMoney Market Account
Rates as of October 2, 2022.

The High Yield Savings account has no minimum balance requirement or monthly service fees. An optional ATM card is available and can be used at ATMs and for making purchases with a PIN. Synchrony Bank offers an ACH bank-to-bank transfer service that allows customers to link up to five accounts at other banks (per FAQ - It used to be ten.) Once the link is established, the customer can initiate electronic deposits and withdrawals to and from those external bank accounts.

Besides the interest rate, the difference between the two accounts is that the Money Market has check writing abilities, while the High Yield Savings account does not. When you open the Money Market account, you can choose to receive checks, which should be received in ten business days.

Synchrony Bank’s New CDs

On May 11th, Synchrony Bank launched two new CDs: the 24-month Bump-Up CD and the 11-month No-Penalty CD. Since their introduction, the No-Penalty CD yield has increased 60 bps, and the Bump-Up CD yield has increased 50 bps. Rates have been comparable to the rates of Ally’s versions of these CDs.

APYMINMAXINSTITUTIONPRODUCTDETAILS
2.75%--Synchrony Bank24 Month Bump Up CD
2.20%--Synchrony Bank11 Month No Penalty CD
Rates as of October 2, 2022.

The 11-month No-Penalty CD has the same features as Ally Bank’s 11-month No Penalty CD. Only a full withdrawal can be done. Partial withdrawals are not allowed. Also you’re allowed a penalty-free early withdrawal anytime after the first six days. The one difference between Ally and Synchrony is that Synchrony is currently only providing one way for requesting a closure (calling a CSR). Ally allows closures to be done via their online account management software.

Synchrony Bank added three new FAQs covering this No-Penalty CD. This FAQ provides the most information:

What's a No-Penalty CD?

A No-Penalty CD is a type of certificate of deposit account that gives you the opportunity to withdrawal your full account balance before the end of the CD term without an early withdrawal penalty. You can make an early withdrawal by calling our Bankers at 1-866-226-5638. Note: due to federal regulations, you can’t withdraw funds during the first six days of your account.

The 24-month Bump-Up CD has the same features as Ally Bank’s 24-month Raise Your Rate CD. You’re allowed only one chance to bump up the rate of the CD to the currently advertised rate on the Bump-Up CD. Once you request the rate bump, the new rate takes effect the same day and will continue until the remainder of the term.

Synchrony Bank added five new FAQs on this new Bump Up CD. This FAQ provides the most information:

What's a Bump-Up CD?

A Bump-Up CD is a certificate of deposit account that offers the opportunity to request a one-time annual percentage yield and interest rate increase or "bump up" during the term of the CD, effective the day you request the increase through the remainder of the term. When you request a "bump up" on your CD rate, you’ll receive the currently advertised rate on the Bump-Up CD term you currently have. You can request a rate increase by calling us at 1-866-226-5638 or by going to your account online, or in the Synchrony Bank app, selecting "Bump Up My CD."

I find it interesting that Synchrony provides an online and mobile option to request a rate bump-up on the Bump-Up CD, but it doesn’t provide an online or mobile option to request an early closure of the No-Penalty CD. Also, I’m surprised Synchrony only added one Bump-Up term. Ally Bank has always offered both a 2-year and 4-year term of its Raise Your Rate CDs. The 4-year term has two options to bump up the rate.

The fact that the 24-month Bump-Up CD yield is now 50 bps below the standard 24-month CD yield (the same difference when it was first launched) shows that the Bump-Up CD may not result in more interest earnings. If Synchrony Bank doesn’t keep this Bump-Up CD rate competitive, the bump-up feature may not be enough to offset the lower rates. Also, it’s not easy to decide when to request a bump up. If you decide too soon, you may miss out on much higher rates. On the other hand, if you wait too long, you have less time to earn the higher rate.

Synchrony CDs Features

Synchrony’s FAQs describe several important features of the CDs. Below are a few FAQs on CDs that I thought would be worth mentioning.

One downside with Synchrony Bank’s 19-month CD as compared with its 12-month CD (besides the longer term) is an early withdrawal penalty (EWP) that is double in size (180 days rather than 90 days of interest). The full details of the EWPs are described in Synchrony’s FAQs:

Q: Is there an early withdrawal penalty for CDs?

An early withdrawal penalty may be assessed if you make a withdrawal prior to the CD maturity date, which is the last day of the CD term. The penalty is applied to the amount of principal withdrawn (no penalty on interest). The bank does not charge an early withdrawal penalty on a CD for the death of an account owner with proper verification.

Penalty Amounts:

  • Terms of 12 months or less: 90 days of simple interest at the current rate.
  • Terms of more than 12 months but less than 48 months: 180 days of simple interest at the current rate.
  • Terms of 48 months or more: 365 days of simple interest at the current rate.

The EWP only impacts early withdrawals of principal. As described in the following FAQ, interest can be withdrawn at any time without penalty:

Q: Can I withdraw my interest from a CD?

You can withdraw interest paid during your CD’s current term anytime without penalty. You can transfer the interest to a Synchrony Bank High Yield Savings or Money Market Account or a non-Synchrony Bank account. For help withdrawing your interest, call us at 1-866-226-5638.

There’s one FAQ on the 15-day rate guarantee period that changed in 2018. This FAQ now reads as follows:

Q: Are there rate guarantees for CDs?

The Bank will give you the CD interest rate in effect on the day the CD was opened as long as we receive and process your opening deposit on or before 15 calendar days from the opening date. We will not go by the postmark date of a deposit. If we receive your deposit within the 15-day period and the current rate for your CD term is higher on the date we receive and process your deposit, the Bank will give you the higher rate. Your interest rate is locked for the term of your CD once we receive and process your deposit.

For IRA CDs, the bank will give you the interest rate in effect on the day the CD was opened as long as we receive and process your opening deposit on or before 60 calendar days from the opening date and you are actively participating in the account opening process. This means all appropriate paperwork must be completed and that funding or appropriate account funding documents must be provided.

The rate guarantee is especially important when rates are rising. According to this current FAQ, “[y]our interest rate is locked for the term of your CD once we receive and process your deposit.” So if you opened a CD on Monday, and Synchrony received and processed your deposit on Wednesday, you will not qualify for the new higher rate that happens to takes effect on Thursday. However, if Synchrony received and processed your deposit on Thursday, you should receive the higher rate. Previously, the FAQ stated that “if the bank rates go up during the rate lock period, the Bank will give you the higher rate.”

Availability

Headquartered in Draper, Utah, Synchrony Bank is an internet bank that offers its services and product line to U.S. citizens and “U.S. lawful permanent residents” who are 18 years or older, have a permanent U.S. residential address, and possess a valid Social Security number.

Application

Synchrony Bank accounts can be opened online or through the Synchrony mobile app, but IRA and Trust accounts require paper forms. The Special 19-month CD can only be opened online or through the app.

Funding an account can be done with an electronic funds transfer. This is done by providing Synchrony with the account number and routing/transit number of an external bank account. If Synchrony can’t automatically verify your external account, it’ll use a trial deposit system. Once the online application completes, Synchrony Bank will mail a welcome kit within 7 to 10 days. The welcome kit includes a signature card that must be signed and mailed back. In addition, the welcome kit includes a deposit slip. If you decide to fund the account with a check instead of an online transfer, a check must be mailed with the deposit slip.

The online application can accommodate up to four beneficiaries per account. Unlike some other financial institutions, Synchrony Bank does not require Social Security numbers for person beneficiaries: only name, address, and date of birth are necessary to add a beneficiary. Non-person beneficiaries can also be designated. Only equal allocations are allowed for the beneficiaries. Percentages cannot be specified. After your account is opened, beneficiaries can be managed online.

According to the CSR, there’s no hard credit inquiry that can ding your credit score. The CSR stated that they “only do soft inquiry to verify your identity."

Bank Overview

Synchrony Bank has an overall health grade of “A" at DepositAccounts.com, with a Texas Ratio of 4.87% (excellent), based on March 31, 2022 data. In the past year, Synchrony Bank’s non-brokered deposits increased by $383 million, an annual growth rate of 0.7%, which is above average for deposit growth. Please refer to our financial overview of Synchrony Bank (FDIC Certificate # 27314) for more details.

Synchrony Bank can trace its origins to a brick-and-mortar institution, the Monogram Bank, USA, which was established in Ohio in 1988. From 1989 to 2014, the Bank moved its headquarters four times and re-branded five times, with the current name change occurring in June 2014. Prior to the name Synchrony Bank, the Bank was known as GE Capital Retail Bank, reflecting its tie to GE Capital, its parent company. In January 2013, GE Capital Retail Bank acquired the deposit base and online deposits business of MetLife Bank, N.A.

Currently, Synchrony Bank is the 41st largest bank in the country with assets in excess of $86 billion.

How the 19-Month CD Special Compares

When compared to similar length-of-term CDs tracked by DepositAccounts.com which are available nationally and have minimum deposit requirements of $10k or less, only one credit union has a higher rate than currently offered on the Synchrony Bank 19-month CD Special. The following table compares the 19-month CD to the two highest-rate CDs from credit unions and to the other two highest-rate CDs from banks. I also include Ally Bank’s 20-month Select CD in the comparison.

The above information and rates are accurate as of 7/18/2022.

To look for the best CD rates, both nationwide and state specific, please refer to our CD Rates Table page.

Related Pages: 1-year CD rates, nationwide deals, Internet banks

Comments
fred_b
  |     |   Comment #1
I just saw a brokered non-callable CD from Synchrony Bank 3.2% for 2 years. Seems a bettter deal to me.

I'm really starting to wonder why I haven't just been doing brokered CD's all this time instead of opening accounts at the issuing FI. The rates seem consistently better, and there's usually a pretty good selection. It's so much easier to manage all your CD's in one place.

I don't think using TD Ameritrade or Vanguard or Fidelity adds any risk because the CD's they offer all come from banks that are FDIC members and their customer service is excellent.

I guess if you want to break a CD and pay the EWP you're a lot better off dealing directly with the issuing FI. I have no idea how one would go about doing this with a brokered CD. But I've only terminated a CD early once.

Some fintechs are trying to offer similar convenience, but their selection is very limited and their customer service is no match for the big brokers.
alan1
  |     |   Comment #2
fred_b wrote: "I guess if you want to break a CD and pay the EWP you're a lot better off dealing directly with the issuing FI. I have no idea how one would go about doing this with a brokered CD."

You cannot "break" a brokered CD. You can sell it -- you make get more than you paid for it; you may get less. And there's no guarantee that you'll be able to sell it (though I've never had a problem in that respect).

If you're considering brokered CDs, I suggest you compare them to Treasury obligations available through brokerages. Depending on the term, Treasuries may have a higher rate than CDs; they are not subject to state and local income taxes; and the bid/ask spread when selling (or buying) in the secondary market is more favorable than in the secondary market for CDs.

I just noticed: you wrote that the rates on brokered CDs "seem consistently better" than the rates on CDs purchased directly from the issuer. That's been true for a while now, but there have been lengthy periods when the best brokered CD rates were lower than the top rates at banks and credit unions.
P_D
  |     |   Comment #4
Deleted.  Already covered.
jimdog
  |     |   Comment #3
Treasuries are the way to go.
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Availability: Nationwide

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Availability: Nationwide

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Availability: Nationwide

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Availability: Nationwide

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