bank rates

4 Banks Challenge 12-Month CD Leader

hand holding a penny between two fingersAlthough the top 12-month CD rate has remained unchanged since early December, we’re seeing some competition creeping up from behind.

That can be a sign of good news to come. Fingers crossed.

AloStar Bank of Commerce (www.alostarbank.com), which is an online bank based in Birmingham, Ala., tops our CD Rates Leaderboard at 1.10% APY and requires a $1,000 minimum deposit.

Four banks now offer the second-highest rate of 1.05% APY – one more than when we last reported on the term in early December:

Chart showing the top and average 12-month CD rates

AmTrust Direct (www.amtrustdirect.com), one of two online banks that are divisions of New York Community Bank, which has 240 branches in five states, requires a $500 minimum deposit.

DollarSavingsDirect (www.dollarsavingsdirect.com), an online division of Emigrant Bank, which has two New York-area branches, one in Manhattan and the other in suburban Ossining, N.Y., requires a $1,000 minimum deposit.

GE Capital Retail Bank (www.gecrb.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 $25,000 minimum deposit.

CIT Bank (www.bankoncit.com), the online consumer bank of CIT Group Inc., which offers financing to small businesses and middle-market companies, offers one of its Achiever CDs for the 12-month term.

With a $25,000 minimum deposit, you can raise the rate once during the term, as well as add to your deposit once.

Pacific Mercantile Bank (www.pmbank.com), which is a community bank with seven branches in Southern California, pays the third-highest rate of 1.02% APY and requires a $10,000 minimum deposit.

Two banks pay 1.01% APY:

BAC Florida Bank (www.bacflorida.com), which is a community bank with one location in Coral Gables that sells its products nationally through My e-BAnC, requires a $500 minimum deposit.

CapitalSource Bank (www.capitalsourcebank.com), a Los Angeles-based lender to small and middle-market business, which has 21 branches in central and Southern California, requires a $10,000 minimum deposit.

The current average annual yield offered by big banks and thrifts for the 12-month term is 0.23%.

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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