4 Pleasant CD Surprises of 2012

Year-end is a time for reflection — and for bloggers to produce lists of noteworthy occurrences during the past 12 months.

As a student of deposit accounts, my list will cover the most pleasant surprises I encountered in my personal CD investing during 2012.

These surprises made an otherwise depressing year for deposits a bit brighter.

Surprise 1. Many banks offered rate bonuses to renew a CD.

With deposits exceeding lending by about $2 trillion, I was surprised so many banks offered me higher-than-posted rates to induce me to keep my money in their CDs.

The best deal surfaced in early 2012, at brick-and-mortar Rabobank. While posting a 5-year APY of 0.71%, it offered all holders of a maturing 2-year CD a 59-month extension at 2.25%.

And, in addition to Ally Bank’s well-known 0.25% “loyalty reward,” I received bump-ups, ranging from 0.05% to 0.24%, to renew online CDs at AIG Bank, Bank of Internet, MetLife Bank and Nationwide Bank.

Apparently, these banks care about long-term depositor relationships.

Surprise 2. Several banks offered add-on CDs with competitive rates.

With CD rates declining, a bank offering a great add-on CD seemed, to my cynical mind, far-fetched.

Why give depositors a good deal?

Therefore, I was surprised when CIT Bank introduced its 2-year Achiever CD in January, offering one-time rate bump-up and deposit add-on rights.

For some time, its 1.25% APY sat atop our CD Rates Leaderboard for the 2-year term. (Its APY is now 1.20%.)

I also was pleasantly surprised that airbanking.com’s 1.12% APY, 1-year CD, briefly at the Leaderboard’s 12-month summit, afforded unlimited add-on rights.

I sorely needed these CDs to hedge against further rate declines.

Surprise 3. I still found CD promotions and specials.

CD rate promotions were rare, but not totally absent, in 2012.

Unfortunately, I couldn’t participate in Salem Five’s 30-month, 1.50% APY special because of FDIC insurance limits.

But I did take advantage of Pentagon Federal Credit Union’s 1.61% APY, 3-year CD offering in November.

And I opened more CDs when it raised this rate to 1.75% in December.

Surprise 4. Some places still offered a 2% APY on 5-year CDs at year’s end.

With 5-year Treasury rates hovering around 0.75%, I’m amazed any institution still offers a 2% APY 60-month CD.

But that’s what BBVA Compass offered most of this year — and offers now — in states where it operates. I’ve opened a bunch.

To BBVA Compass — and all the other institutions mentioned above — thanks for providing some pleasant moments in an otherwise dreary year for CD rates.