Nexity Bank is making a fresh start with some of the best CD rates in the country.
That’s unusual for a bank that’s been seized and sold by the Federal Deposit Insurance Corp.
Most new owners want to cut the interest rates savers are being paid.
But Nexity’s new leaders want to grow the online bank based in Birmingham, Ala., and are out to attract more deposits from savers nationwide.
Here’s where to find Nexity’s latest CD rate sheet.
The bank’s early withdrawal penalties are more lenient than average – one month worth of interest for CDs of 12 months or less, and three months worth of interest for longer CDs.
Deposits in the new Nexity Bank are FDIC-insured up to $250,000, just as they were under the previous owner.
You can open an account online and fund via electronic transfer or print out an application and mail it in.
Through all of its travails, Nexity has maintained a top A+ rating from the Better Business Bureau, so that says something for its customer service.
When Nexity was founded in 1999 it became what’s called a correspondent bank, which is sort of like a bank for banks.
It not only provided services to small banks across the south, such as processing electronic transfers, but it provided money for loans and help with the underwriting process.
That’s where Nexity ran into trouble. When the financial crisis struck in 2008 it was involved in scores of construction loans that fell into default when sales dried up and builders couldn’t repay them.
The holding company that owned the online bank filed for bankruptcy in July 2010 and began looking for new investors and new capital it never found.
The bank was seized by the FDIC in April 2011 and sold to a new company that was specifically created to buy Nexity.
AloStar Bank of Commerce, as the new owner is called, is being led by Michael Gillfillan, the former vice chairman and chief credit officer at Wells Fargo.
The AloStar name is now appearing on the Nexity website and it’s possible the bank will assume that name in the future.