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Bank Deals Weekly Summary for April 19, 2008


Quick Link for Rates, Recap of this week's posts

Savings account and CD rate cutting slowed this week. It has been about a month since the last Fed rate cut of 75 basis points, and rates seemed to have mostly stabilized. The next Fed meeting is on April 29th, and another rate cut is expected. However, as this article describes, the expectations for a half-point rate cut has gone down. Most are expecting only a 25-basis-point cut. The article reports on a speech given by Richard Fisher in which he explains why more Fed rate cuts would be a mistake. Fisher is one of the few FOMC members who have been voting against rate cuts. In the speech he described the problem:
Trying to solve the financial industry's structural problems with more interest rate cuts would only worsen the situation by stoking inflation

He describes why inflation is more of a concern now than it was in previous years:
Globalization, once helpful in tamping down U.S. inflation by creating access to cheap labor, has become a headwind as demand for goods in developing nations rises rapidly.

Hopefully, he'll have more support in the FOMC, and the rate cuts will soon be history.

Long Term CD Rates Rise - Inflation Anticipation?

Several banks appear to be seeing the potential for rising interest rates and are increasing their long term rates. Banks this week that increased their long term CD rates include Countrywide, KeyDirect, M&T Bank, E-LOAN, E*TRADE and Intervest. Countrywide raised its long term CDs to as high as 4.50% APY for terms of 36 to 60 months. Its long term yields had only been 3%. KeyDirect raised its long term CDs by 25 basis points with a 60-month CD yield of 4.75% APY and a 84-month CD yield of 5.00% APY. The highest long term CD rate continues to be at Capital One Bank which made a large rate increase in the previous week. Its 7 and 10 year CD yield remains at 5.50% APY.

In addition to the online banks, several of the large banks have some decent long term CD rates. National City continues to offer a 5% 48-month CD special. Other large banks with competitive long term CD rates include Wachovia and BB&T Bank. See my recap below for the reviews of these.

Savings Accounts and Short Term CDs

The rate increases weren't all in long term CDs. E-LOAN actually raised its savings account rate this week from 2.75% to 3.00% APY. The 3% isn't anything to write home about, but it's nice to see a change in direction. There are still many online savings accounts that didn't lower their rates below 3% including major players like ING Direct and HSBC Direct. So perhaps the competition moved E-LOAN to raise its rate.

The savings account competition is helped by banks that continue to launch new online savings accounts. One of the latest is OnBank, an internet bank launched by M&T Bank. I reported on OnBank this week and its 3.49% no-minimum online savings account and its online CDs. It appears to have a decent ACH transfer system, but there are some issues like a $20K/day tranfer limit (see post).

For short term CD deals, Indymac Bank came out with a special 6-month CD this week with a 4.15% APY. Alliant Credit Union still has the best 12-month CD deal with a 4.40% APY 12-month CD with a $25K minimum deposit. For smaller deposits, Patelco Credit Union still has a good deal with its 12-month CD with a yield of 4.07% APY.

If you want a 12-month CD without a minimum deposit and that's easy to fund and manage, ING Direct came out with a fairly competitive 12-month yield of 3.30% APY. The previous week, ING Direct came out with a decent 9-month CD yield, but this has ended.

A reader informed me that Xceed Financial Credit Union (formerly Xerox FCU) has extended its special 5% APY 5-month CD with a $25K maximum deposit (see post). I just posted on another 5% 5-month CD at Premier America Credit Union. However, the maximum deposit is much smaller at $5K (see post)

Series I Savings Bonds

There's a good short term opportunity available with the Series I Savings Bonds. The Consumer Price Index numbers for March were released this week, and as expected, inflation was high. The result is that the inflation component for the I Bonds starting in May will be 4.83%, the second highest it has ever been. If you buy I Bonds before May, you can get a guaranteed rate of about 4.40% for 14 months. Unfortunately, there's a new low annual cap of $10K on I Bonds (see post).

Reward Checking Accounts

More small banks and credit unions continue to launch high yield reward checking accounts. Most are now launching with rates under 6%, but most are still above 4%. I posted on over a dozen new ones this week (see below). There are still several reward checking accounts with yields of around 6% that have nationwide availability (see below). I just changed the status of the reward checking at Arizona Bank & Trust to nationwide after I received word this week from a CSR that they're accepting out-of-state customers. In addition to this, they're guaranteeing to keep their 6.01% yield until April 2009. The one downside is a below-average cap of $20K. Please keep in mind that small banks often change their policies regarding out-of-state accounts (see post).

For the latest nationwide reward checking list, please see below. I also have this list in a table format at my new High Yield Checking Deals website. This website's home page has a table with a full list of reward checking accounts.

Recap for the Week

Banking News

Savings and Money Market Accounts - National

CD Deals - National

Checking/Savings Account Bonuses

Reward Checking Accounts

CD and Money Market Deals - Local

The rates listed below are based on Annual Percentage Yield (APY). No minimum balances are required unless noted. MMA next to the rates indicate a money market account. Most MMAs have check writing and ATM cards. Online savings accounts usually lack both of these. The top lists include banks and credit unions with broad availability and with minimums around $10K or less. Previous weekly summaries are available for Apr 12th, Apr 5th, Mar 29th, Mar 22nd, Mar 15th, Mar 8th, Mar 1st, Feb 23rd and Feb 16th.

Quick Links: Refer to the following links for the savings accounts and CDs that interest you: Liquid Account Rates: Savings Accounts, Reward Checking, Local checking/savings, Bank alternatives CD Rates: 3 Mo CDs, 6 Mo CDs, 9 Mo CDs, 12 Mo CDs, 18 Mo CDs, 24 Mo CDs, 36 Mo CDs, 48 Mo CDs, 60 Mo CDs, 84 Mo CDs, CDs by state Comments: read and discuss

As of April 19, 2008

Checking/Savings/Money Market Accounts:

3-Month Certificates of Deposit:

6-Month Certificates of Deposit:

9-Month Certificates of Deposit:

12-Month Certificates of Deposit:

18-Month Certificates of Deposit:

24-Month Certificates of Deposit:

36-Month Certificate of Deposit:

48-Month Certificate of Deposit:

60-Month Certificate of Deposit:

84-Month Certificate of Deposit:

High Yield Reward Checking Accounts - Open to All

Checking and Saving Accounts at Local Banks/Credit Unions

CD Specials at Local Credit Unions/Banks Over the Last Month

  • Alabama deals and CD rates
  • Alaska deals and CD rates
  • Arizona deals and CD rates
  • Arkansas deals and CD rates
  • California deals and CD rates
  • Colorado deals and CD rates
  • Connecticut deals and CD rates
  • Delaware deals and CD rates
  • District of Columbia deals and CD rates
  • Florida deals and CD rates
  • Georgia deals and CD rates
  • Hawaii deals and CD rates
  • Idaho deals and CD rates
  • Illinois deals and CD rates
  • Indiana deals and CD rates
  • Iowa deals and CD rates
  • Kansas deals and CD rates
  • Kentucky deals and CD rates
  • Louisiana deals and CD rates
  • Maine deals and CD rates
  • Maryland deals and CD rates
  • Massachusetts deals and CD rates
  • Michigan deals and CD rates
  • Minnesota deals and CD rates
  • Mississippi deals and CD rates
  • Missouri deals and CD rates
  • Montana deals and CD rates
  • Nebraska deals and CD rates
  • Nevada deals and CD rates
  • New Hampshire deals and CD rates
  • New Jersey deals and CD rates
  • New Mexico deals and CD rates
  • New York deals and CD rates
  • North Carolina deals and CD rates
  • North Dakota deals and CD rates
  • Ohio deals and CD rates
  • Oklahoma deals and CD rates
  • Oregon deals and CD rates
  • Pennsylvania deals and CD rates
  • Rhode Island deals and CD rates
  • South Carolina deals and CD rates
  • South Dakota deals and CD rates
  • Tennessee deals and CD rates
  • Texas deals and CD rates
  • Utah deals and CD rates
  • Vermont deals and CD rates
  • Virginia deals and CD rates
  • Washington State deals and CD rates
  • West Virginia deals and CD rates
  • Wisconsin deals and CD rates
  • Wyoming deals and CD rates

Terms of 60 Months and Over

Terms of 24 Months to Under 60 Months

Terms of 12 Months to Under 24 Months

Terms of Under 12 Months

Bank Account Alternatives

Historical Rates from the Federal Reserve (Federal funds, Treasury bills, CD's)
Anonymous   |     |   Comment #1
Don't forget not to miss out on the fake %9000 TD Ameritrade deal:)
singlepap@gmail.com   |     |   Comment #2
All shlemazel missed the deadline on deal of the year at TDAmeritrade. Have to wait till next week now, to get on-board the one at another house. Pays faster though, for everyone with liquid 25k/50k
Anonymous   |     |   Comment #3
ok, not much, but 6-7 months ago I opened cd at western based on info from this site. Just signed on to check balance, they're giving away a $10 gift card to Barnes and Noble, subway, mcdonald's or starbucks as a thank you for patience in their updating their site
singlepap@gmail.com   |     |   Comment #4
Another case in point for the shrink, who commented here last week. People jump up-and-down about $10 gift from a bank; and choose to ignore $1000 gift from brokerage house, for doing exactly the same thing - buying a CD or Money Market account. Not enough that they ignore $1000 gift - they also take the time to post here about how annoyed they are at someone reminding them about it. And in so posting, they make others miss the offer.

This reminds of crab syndrome, Dr. One crab would struggle and get out of the bucket. But when there is a bunch of crabs, they make sure to pull him back in - so that he suffers the same fate!
Banking Guy
Banking Guy   |     |   Comment #5
Forgot to mention in the weekly summary that in addition to E-LOAN, KeyDirect also raised its money market account yield from 2.75% to 3.00% APY. Perhaps this is an indication we're nearing the bottom of the rate declines.
Anonymous   |     |   Comment #6
Quote: "they also take the time to post here about how annoyed they are at someone reminding them about it. And in so posting, they make others miss the offer."

How can that be?

These posts about broakerage house deals keep appearing EVERY time I access this site to keep up on the latest insured CD and MM rates.
singlepap@gmail.com   |     |   Comment #7
Care to provide evidence that a Bank CD purchased at brokerage house is NOT insured by FDIC?
Anonymous   |     |   Comment #8
"Care to provide evidence that a Bank CD purchased at brokerage house is NOT insured by FDIC?"

By singlepap@gmail.com, at 7:38 AM, April 21, 2008

singlepap@gmail.com   |     |   Comment #9
What's not clear, anonymous (???)
The entire population of this blog buys CD's from the banks, who offer $10-$100 bonuses. But when (from time-to-time) a brokerage house has an offer (oh my God, not listed on their website!?) of $1,000 bonus to open account there - the population says "No, we're too noble to associate with anything like that". Despite the fact that you can buy Bank CD (Wamu 3.4%, anyone?) on the 25k you just deposited there. People are totally financially neglectful to realize that $1,000 bonus they collect simply equals to extra 4% annual boost to their CD interest, thus yielding them 7.5% FDIC insured. But no, God forbid: if I'm not doing - will I let others do it??? So ever since my original disclosure on this website - the only positive comment that ever followed was from the Banking Guy himself. Every single anonymous comment was to prevent others from taking advantage of the deal. On the other (more established and populous) website, I only won thunderous thanks. Here, people keep contemplating: are we lucky to lock-in 4 percent; or maybe, God willing, there is 4.5% offered somewhere, on my 25k or 50k (most have a spouse) or 75k (another next of kin, also qualified for the bonus) or 100k (one more name). The only possible answer to your ??? is !!!
Jay   |     |   Comment #10
The limit on ibinds per year is $5,000, not $10,000.
Banking Guy
Banking Guy   |     |   Comment #11
The $10K cap includes $5K electronic (from Treasury Direct) and $5K paper.