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Money Market vs. Checking Account: How Do They Differ?GMAC Bank's Parent Posted Record Losses
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POSTED
ON BY Ken Tumin
The third quarter was very difficult for GMAC LLC, the parent of GMAC Bank. As Bloomberg reports, both the home-loan unit and the auto finance business reported big losses:
GMAC is hoping that its application to become a bank holding company gets approved so it can participate in the Treasury's Troubled Asset Relief Program (TARP).
The article also mentioned how this is affecting GMAC Bank:
So depositors are benefiting. GMAC Bank is currently paying a very competitive 3.75% APY on its Online Savings Account. GMAC Bank recently removed the minimum balance requirements and monthly service fees on both the Online Savings Account and the Money Market Savings Account. GMAC Bank's CD rates also continue to be very competitive. For more details about these accounts, please see my latest GMAC Bank review.
I've been very happy with my GMAC Bank accounts, so I hope the troubles at GMAC LLC won't adversely affect GMAC Bank. Besides the high rates, the best part of GMAC Bank has been their ACH transfer system. I can easily add links to many other external accounts. Transfers are fast (often completing in one or two days), and hold times are no more than two days.
GMAC Bank's financial ratings for soundness have gone down a bit, but they remain decent: 3 stars (performing) at Bankrate.com and 3.5 stars (good) at BauerFinancial. Both are based on 6/30/08 data. As I recommend with any bank, it's best to keep under the FDIC limits (GMAC Bank's FDIC Certificate # 57803).
The third-quarter net loss widened to a record $2.52 billion from $1.6 billion a year earlier ... Total net revenue declined 43 percent to $1.72 billion. The Residential Capital home-loan unit lost $1.9 billion during the quarter, and GMAC's auto finance business lost $294 million.
GMAC is hoping that its application to become a bank holding company gets approved so it can participate in the Treasury's Troubled Asset Relief Program (TARP).
The article also mentioned how this is affecting GMAC Bank:
Deposits at GMAC Bank advanced to $17.7 billion during the quarter from $16.9 billion at the end of the second quarter. GMAC is paying above-market interest rates to attract deposits through its bank.
So depositors are benefiting. GMAC Bank is currently paying a very competitive 3.75% APY on its Online Savings Account. GMAC Bank recently removed the minimum balance requirements and monthly service fees on both the Online Savings Account and the Money Market Savings Account. GMAC Bank's CD rates also continue to be very competitive. For more details about these accounts, please see my latest GMAC Bank review.
I've been very happy with my GMAC Bank accounts, so I hope the troubles at GMAC LLC won't adversely affect GMAC Bank. Besides the high rates, the best part of GMAC Bank has been their ACH transfer system. I can easily add links to many other external accounts. Transfers are fast (often completing in one or two days), and hold times are no more than two days.
GMAC Bank's financial ratings for soundness have gone down a bit, but they remain decent: 3 stars (performing) at Bankrate.com and 3.5 stars (good) at BauerFinancial. Both are based on 6/30/08 data. As I recommend with any bank, it's best to keep under the FDIC limits (GMAC Bank's FDIC Certificate # 57803).