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4.15% 6-Month / 4.50% 18-Month CD at a Californa Bank (Downey Savings)


Update 11/21/08: The bank has been closed. Please refer to this post for more details.

Update 8/23/08: The 18-month CD yield has gone down to 4.50% APY. The title has been modified to reflect this change.

Downey Savings is offering an attractive CD promotion that includes a 4.15% APY 6-month CD, a 4.30% APY 12-month CD and a 4.60% APY 18-month CD. The minimum deposit is $1,000, and the maximum deposit is $250,000. New money is required. According to the small print below the rate table it states that listed rates in effect for California branches only.

Branches are located throughout California including the cities of Los Angeles, San Diego, San Jose and Sacramento.

My last post on Downey Savings was on July 13th when the bank was offering a 4% 9-month CD.

Downey Savings is another California bank that has been hit hard by the slumping housing market and the credit crunch. In the latest news from the LA Times "Downey Financial Corp. reshuffled its top management and signaled that it would seek to sell the company. But analysts said it would have trouble finding a buyer." The bank has a 2-star rating (problematic) at BauerFinancial and a 1-star rating (lowest) at Bankrate. Both are based on 3/31/08 data.

As I recommend with any bank, be sure to stay under the FDIC insurance limits. Under the Downey Savings' rate table, there's a link to a page with details regarding FDIC coverage. It appears Downey Savings does allow POD beneficiaries in the account title since they state "it is possible for a husband and wife with 2 children to have up to $1.5 million in insured deposits when their accounts are properly structured." For more information and potential risks of extending coverage above $100K, please refer to this post. Downey Savings has been FDIC insured since 1957 (FDIC Certificate # 30968).

Thanks to the reader who commented on this new CD special in the Finding the Best Deals Post.

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Anonymous   |     |   Comment #1
The only California bank more likely to fail than Downey is Security Pacific which finally started advertising decent rates in the LA Times.