Best Bank Account Interest Rates - Summary For February 23, 2021
Federal Reserve, the Economy and CD Rate Forecast - February 23, 2021
The Best Cash Management Accounts in February 2021
GMAC Reported To Have Agreed to Deposit Rate Limitations
POSTED
ON BY Ken Tumin
According to this WSJ article, GMAC (the parent of Ally Bank) is nearing completion of an agreement with the U.S. government for receiving another round of taxpayer money. In addition to the impact to taxpayers, Ally Bank customers may see an effect of this. The article mentioned the following:
Hopefully, Ally Bank will be allowed to keep interest rates competitive with other internet banks. The FDIC publishes weekly rate caps that are intended for "less than well capitalized institutions." The rate cap for a savings account is currently only 0.96%. The FDIC still doesn't have separate caps for internet banks. I have more on these FDIC rate caps in this May post.
Ally/GMAC Bank's high deposit rates received attention by the American Bankers Association last May, and they complained to the FDIC (see post). In June, GMAC released news on the FDIC's plans to tie GMAC's tapping of funds under a federal debt guarantee program with Ally Bank's deposit rates (see post).
Ally Bank deposit rates have gone down since June, but the rates have remained competitive as compared with other internet banks. It appears Ally Bank has been able to avoid significant limitations on its deposit rates. Hopefully, this will continue. However, if we see big rate cuts, we'll know the cause.
Thanks to the reader who emailed news of this WSJ article.
As part of the agreement, GMAC agreed to keep interest rates on deposit accounts offered through its banking unit at certain levels, according to people familiar with the situation.
Hopefully, Ally Bank will be allowed to keep interest rates competitive with other internet banks. The FDIC publishes weekly rate caps that are intended for "less than well capitalized institutions." The rate cap for a savings account is currently only 0.96%. The FDIC still doesn't have separate caps for internet banks. I have more on these FDIC rate caps in this May post.
Ally/GMAC Bank's high deposit rates received attention by the American Bankers Association last May, and they complained to the FDIC (see post). In June, GMAC released news on the FDIC's plans to tie GMAC's tapping of funds under a federal debt guarantee program with Ally Bank's deposit rates (see post).
Ally Bank deposit rates have gone down since June, but the rates have remained competitive as compared with other internet banks. It appears Ally Bank has been able to avoid significant limitations on its deposit rates. Hopefully, this will continue. However, if we see big rate cuts, we'll know the cause.
Thanks to the reader who emailed news of this WSJ article.
They are trying to get as many new customers as they can before they get constrained.
1. If you funded it via an ACH transfer and close the CD before 60 days have passed, they will only pay out via ACH transfer to the original financial institution. That is fair since ACH transactions can be rescinded in 60 days.
2. Their process for CD closure is, by some odd coincidence, slow and error-prone. That is *not* fair.
The highly-touted 24x365 phone center can't do the closure themselves - the agent requests the closure from another department (only open 9-5 on business days) that takes a couple of business days to actually initiate the outbound ACH transfer. (ACH transfers usually take two days to complete after they have been initiated - that is not the issue here.)
Rather than fill out a form, the agent sends an email using a template. In my case, the agent's email gave instructions on what to do with the money upon maturity - instead of requesting an immediate closure. The agent knew that I wanted immediate closure - even asked me politely why I was taking the money out.
I called every day to check status. Every day an agent would say that the money would be sent the next day. Eventually one agent looked closely at the email and discovered the first agent's error.
A couple of days later, the unreachable special department finally initiated the ACH transfer.
I am getting out of that bank.
Then I wrote a check to open the account. I come to find out that the credit union has put a twenty day hold on the funds availability. They said there was not information on the checks that Ally prints for their customers. There is no address or phone number of the bank. I thought a routing number would be sufficient. I provided the Ally phone number to the credit union, hopefully that helps.
http://www.nytimes.com/2009/10/29/business/29gmac.html?hp