New Jersey-based ValleyDirect (online division of Valley) is the latest bank to make a foray into 4% territory. Following the recent addition of 40 bps, ValleyDirect's Online Savings Account (OSA) now earns 4.00% on all balances. The fee-free OSA can be opened with a minimum deposit of $1.
Although ValleyDirect has been operating since March 2020, the only account in the product line is the Online Savings Account, which made its debut offering 1.70% APY on all balances. That rate lasted for a month before it dropped to 1.00% APY in April 2020. Four months later, the rate fell to 0.55% APY where it remained until March 2022. In the past nine months, there have been 11 rate increases, adding a total of 345 bps.
According to ValleyDirect’s FAQs section,
There are 6 ways you can add money to your account:
- #1 Deposit funds during the initial account opening. You will need a valid U.S. bank online account username and password.
- #2 Initiate an inbound external transfer from another financial institution through Personal Online Banking on your computer, or using the Valley mobile app on your phone or tablet.
- #3 Initiate a money transfer or wire transfer from another financial institution, or transfer from a Valley Bank account.
- #4 Receive money in your ValleyDirect account from another account via Zelle. You must ensure your ValleyDirect account is your primary account for Zelle within Valley Personal Online Banking.
- #5 Deposit checks via the Valley Mobile Banking App.
- #6 Set up a direct deposit of your payroll, pension or government benefit such as Social Security.
Withdrawals via ACH
Since my March blog post, ValleyDirect has tripled the ways to make a withdrawal from an Online Savings Account. Previously, the only withdrawal method initiated through ValleyDirect was to request a check, as ValleyDirect did not initiate ACH transfers (outgoing or incoming). Account owners can now transfer funds via Zelle (using the Personal Online Bank platform) or through an ACH transfer initiated by ValleyDirect. According to CSR, the daily limits on ValleyDirect initiated ACH transfers are $45k inbound and $3.5k daily outbound. Not surprisingly, CSR recommended using another financial institution to pull any large amount from an Online Savings Account.
Availability and Account Opening
ValleyDirect’s online application is available to U.S. citizens/resident aliens, 18 years or older, who have a valid Social Security number and a physical U.S. address in any state.
A Chex Systems inquiry is done when opening an Online Savings Account.
Valley Direct now allows two beneficiaries (equal shares) to be designated; Social Security numbers are required for any beneficiary.
While opening an Online Savings account can only be opened online, additional deposits and withdrawals in/out of an Online Savings account can also be done at any Valley brick-and-mortar locations. Valley currently has 234 full-service branch locations in Alabama (16), Florida (44), New Jersey (129), and New York (45).
Headquartered in Wayne, New Jersey, ValleyDirect is an online division of Valley (formerly known as Valley National Bank), the largest bank headquartered in New Jersey. ValleyDirect was launched in February 2020 in response to the “rising trend of customers who want digital and mobile-focused banking solutions.”
Deposits at ValleyDirect and Valley are combined for the purpose of calculating FDIC insurance limits and are not separately insured.
ValleyDirect/Valley has an overall health grade of "A+" at DepositAccounts.com, with a Texas Ratio of 4.47% (excellent) based on June 30, 2022 data. In the past year, the Bank increased its total non-brokered deposits by $10.29 billion, an excellent annual growth rate of 32.74%. Please refer to our financial overview of ValleyDirect/Valley (FDIC Certificate # 9396) for more details.
Valley National Bank’s history has been one of steady growth and expansion. Founded in 1929 as the Passaic Park Trust Company, the Bank changed its name in the mid-1930s to the Bank of Passaic and Trust Company. In 1956, the purchase of the Bank of Allwood began 65 years of development, including the acquisition/purchase of 23 New Jersey, six New York, and three Florida financial institutions, and three rebrands (Bank of Passaic and Trust Company, Bank of Passaic and Clifton, National Association, and Valley National Bank). Currently the largest bank headquartered in New Jersey, Valley has a market area covering one of the most populated part of the country, assets in excess of $54 billion, and nearly 700,000 customer accounts.
How the Online Savings Account Compares
When compared to the nationally available Savings Accounts tracked by DepositAccounts.com that do not require a large minimum balance and are not limited by small balance caps, ValleyDirect’s Online Savings Account APY currently ranks fourth.
The above information and rates are accurate as of 12/10/2022.
To search for the best Savings Account, both nationwide and state specific, please refer to DepositAccounts.com’s Savings Account Rates page.