bank rates

2 Cuts Hurt 24-Month CD Rates

$100 bills fanned outWe’ve had two of the banks we track for 24-month CD rates cut their rates in the last month.

One of those cuts came from the term leader, which means the top deal on our CD Rates Leaderboard has dropped to 1.20% APY.

CIT Bank (www.bankoncit.com) now tops the term with one of its Achiever CDs.

The online consumer bank of CIT Group Inc., which offers financing to small businesses and middle-market companies, requires a $25,000 minimum deposit for that 1.20% APY, but you can add money to your account once, as well as bump up the rate once.

Former leader AloStar Bank of Commerce (www.alostarbank.com) is now one of five banks that pay 1.15% APY.

The online bank based in Birmingham, Ala., requires a $1,000 minimum deposit.

The other banks offering that rate:

Barclays (www.banking.barclaysus.com), which is the online American operation of the worldwide British bank with more than $2 trillion in assets, has no minimum balance requirement.

GE Capital Bank (www.gecapitalbank.com), which is one of two online banks, each with its own FDIC insurance, that are subsidiaries of GE Capital Corp., the financial services unit of the manufacturing giant, requires a $500 minimum deposit.

GE Capital Retail Bank (www.gecrb.com), the other bank that’s a subsidiary of GE Capital Corp., requires a $25,000 minimum deposit.

Hudson City Savings Bank (www.hcsbonline.com), which is a regional bank with 130 branches in New Jersey, New York and Connecticut, requires a $500 minimum deposit for anyone living in that tri-state area but a $5,000 minimum deposit for everyone else.

Pacific Mercantile Bank, which had offered a 1.16% APY, cut its yield way, way down to 0.80% APY. That’s the other major cut we’ve seen.

The average annual yield offered by big banks and thrifts for the 24-month term is 0.37% for a fifth week.

These banks qualify for our rankings by imposing no restrictions on who can buy their certificates of deposit, either online or through the mail.

Compare these returns with the best CD rates from scores of banks in our extensive database.

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