About Ken Tumin

Ken Tumin founded the Bank Deals Blog in 2005 and has been passionately covering the best deposit deals ever since. He is frequently referenced by The New York Times, The Wall Street Journal, and other publications as a top expert, but he is first and foremost a fellow deal seeker and member of the wonderful community of savers that frequents DepositAccounts.

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Best Bank Account Interest Rates - Summary for Week Ending January 5, 2013


Best Bank Account Interest Rates - Summary for Week Ending January 5, 2013

The big economic news this week was the fiscal cliff compromise. There are many issues with the compromise, but it has reduced concerns that the economy will be dragged back into recession. The Calculated Risk Blog explained it well in its summary for the week:

it appears the amount of austerity will not be large enough to drag the economy into a new recession. Still, austerity will be a drag in 2013 and that probably means another year of sluggish growth.

We saw sluggish growth in 2012, and this is likely to continue in 2013. Friday's employment report is another indication of this. The job growth for December was mediocre, and the unemployment rate remains high at 7.8%.

One surprise development this week came from the release of the Fed's December meeting minutes. It showed that several FOMC members thought the Fed should cut back on its quantitative easy (QE) before the end of 2013. It's debatable if this is really a sign that the Fed will end QE earlier than expected. Nevertheless, that's how the market interpreted it. This and the fiscal cliff deal pushed Treasury yields higher. According to Bloomberg, "Treasury 10-year yields soared the most since March" this week. Treasury yield changes over the last week and the expectation of future Fed funds rates are shown below. Numbers are based on Yahoo bond rate data and the CME Group FedWatch.

Treasury Yields:

  • 6-month: 0.09% up from 0.08% last week
  • 2--year: 0.26% up from 0.24% last week
  • 5--year: 0.81% up from 0.71% last week
  • 10-year: 1.90% up from 1.70% last week
  • 30-year: 3.10% up from 2.86% last week

Fed funds futures' probability of rate hike by:

  • Jan 2015: 61% up from 58% last week
  • Apr 2015: 74% up from 68% last week

There were no bank failures or credit union failures this week. There were a total of 51 bank failures and 15 credit union failures in 2012. I have more details in my review of the 2012 bank failures.

Savings & Checking Account Rates

The first week of the new year was quiet with no rate cuts on my list of the top nationally available savings and money market accounts. There was one rate hike, but it wasn't a surprise since it was announced last month. Effective on January 2nd, FNBO Direct increased its online savings account rate from 0.65% to 0.85%. It's not high enough to get excited about it, but it's high enough to qualify for my list. I'm a little worried that this rate is just temporary to prevent customers who participated in FNBO Direct's savings promo from moving their money. Hopefully, it's a sign that FNBO Direct intends to keep the savings account competitive. FNBO Direct had done a decent job at this before 2011, but in late 2011 and early 2012 the rate plummeted.

One bank that will probably never bring back a competitive online savings account rate is HSBC. Its online savings account had yet another rate cut this week. Its rate is now only 0.20%. This account dropped off my list in June when the rate fell from 0.80% to 0.50%. It's clear that HSBC has essentially given up on its online savings account and has no intention of keeping the rate competitive.

It's interesting to note that the online savings accounts at HSBC and FNBO Direct had a yield of 6.00% back in 2007. They were both rate leaders back then.

For today's rate leaders, I have 12 banks and credit unions on my list with non-promo savings or money market account yields of at least 1.00%.

For those with large balances, the best non-promo deal continues to be at Connexus Credit Union which has a money market account that pays 1.15% APY for balances of at least $100K. The next best are the four internet banks with money market accounts that continue to pay 1.05% APY.

Two internet banks are offering 1.25% APY, but these are promo rates. You can also get 1.10% APY at AmericaNet Bank and its two sister banks, but all three have a $35K balance cap.

Reward Checking Accounts

On my list of nationally available reward checking accounts, two institutions cut their reward checking rates this week. The most disappointing cut was at Provident Credit Union which reduced its yield from 2.01% to 1.76% for balances up to $25K. This leaves ABCO Federal Credit Union as the only institution on my list with a reward checking account with a yield of at least 2% for balances up to $25K. Provident is now tied with Connexus Credit Union with essentially the same rate for balances up to $25K.

The second institution with a rate cut this week is Heritage Bank. Its yield fell from 1.61% to 1.51% for balances up to $25K.

If you want a reward checking account with a balance cap of at least $25K, there are only six institutions on my list that have this balance cap (at minimum) and have a top yield of at least 1.50%.

There are still new reward checking accounts being introduced, but these are local deals. I reviewed two Illinois banks with new reward checking accounts this week. One has a 4.07% APY and the other has a 2.50% APY. However, both have a balance cap of only $15K.

There are still many local deals with balance caps of $25K and yields over 2.00%. To find the highest reward checking rates and balance caps in your state or nationwide, please refer to our reward checking rate table. If you're new to these tables, my rate table guide should be useful. If you're new to reward checking, please refer to my blog post, 10 Common Traits of High-Yield Reward Checking.

Rate Hikes:

  1. FNBO Direct Savings - 0.85% [was 0.65%]

Rate/Balance Cap Cuts:

  1. Provident Credit Union reward checking - 1.76% (up to $25K) [was 2.01%]
  2. Heritage Bank reward checking - 1.51% (up to $25K) [was 1.61%]
  3. HSBC Online Savings - 0.20% [was 0.30%]

Certificate of Deposit Rates

My recap of CD rate changes and the list of CD deals will now be in my survey of the best CD rates. This recap will now focus on banking news of the week and liquid accounts.

Recap for the Week - Links to This Week's Posts

Banking News/Resources Savings/MMA - National
  • No new posts this week
CD Deals/Resources - National Checking/Savings/CC Bonuses Reward Checking Accounts CD and Money Market Deals - Local Posts from Previous Weeks 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. Previous weekly summaries are available at this page.

Rates as of January 5, 2013

Checking/Savings/Money Market Accounts:

  • Noteworthy Accounts Available Nationwide:

Reward Checking Accounts:

  • Noteworthy Accounts Available Nationwide:

Certificates of Deposit:

Various Deposit Account Deals

Bank Account Alternatives - NOT FDIC Insured

Historical Rates from the Federal Reserve (Federal funds, Treasury bills, CD's)