bank rates

Highest CD Rates Roundup For Sept. 6

Bringing you the very best CD rates from credit unions and local banks.I wanted to give an update on a couple of numbers I wrote about two weeks ago.

At the time, the 5-year U.S. Treasury had closed at its highest yield in more than two years.

On Thursday, it closed even higher at 1.85%. (It’s been trading a bit lower throughout much of today after the government released some fairly disappointing employment numbers.)

That new high-water mark makes the spread between 5-year Treasury yields and average 5-year CD rates even greater. As I noted in that previous post, historically these two numbers have been closely correlated.

The average 60-month CD rate fell to 0.78% APY this week, according to our survey of large banks and thrifts.

As a result, the spread between the two rates hit 1.07 percentage points.

That hasn’t happened since January 2009, when the average 5-year CD paid 2.50% APY and the Treasury yield was 1.36%. That disparity came out in favor of CD buyers.

Rarer still, the last time Treasuries paid this much more than average CDs was June 2007. What’s more, the difference has been greater than it was this week in just four other weeks since late 2000.

Yes, we’ve seen a couple more smaller banks boost their 60-month deals to 2% or more over the last couple of weeks, but the overall picture remains dreary.

Consider some of the nation’s largest banks.

Wells Fargo pays a pathetic 0.50% APY on its special 58-month CD. That’s unchanged from June, the last we checked.

And amazingly, Bank of America is even worse, paying 0.30% APY.

History would dictate CD rates everywhere should be on the rise – now or soon. But with the Federal Reserve’s intervention in the market, these aren’t typical times.

This week we added two deals to our list of the highest CD rates from credit unions and local banks:

  • Financial Plus Credit Union (www.financialpluscu.com) in Iowa pays 1.70% APY with a $500 minimum deposit on 36-month CDs and 1.80% APY on 48-month CDs. Credit union membership is open to current members’ family members, as well as to anyone who lives or works in the central Iowa counties of Boone, Dallas, Jasper, Madison, Marion, Polk, Story or Warren.
  • Winchester Savings Bank (www.winchestersavings.com) in Massachusetts pays 1.30% APY with a $500 minimum deposit on 24-month CDs. You have to be a resident of Massachusetts to buy these certificates of deposit and do so in person. Winchester Savings Bank has four branches just north of Boston, in Winchester, Arlington and Woburn.

We saw just a couple of changes on our list this week.

Fort Knox Federal Credit Union, which offers nationally available deals, cut its 23-month special rate from 1.40% APY to 1.10% APY and its 14-month rate from 1.20% APY to 1.10% APY. Those are still good enough to remain on our list.

We did, however, remove the 15-month deal from Aspire Federal Credit Union in New Jersey after it cut rates and the 18-month deal from Horizon Credit Union in Idaho, Montana and Washington state after its special ended.

You’ll find the top-paying deals clearly marked on our highest CD rates page, showing where they are available, with a quick link back to the original post, which includes more information on the institution and its requirements.

We’ll update this page weekly, so you’ll always know what great deals are out there from credit unions and local banks.

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  1. SeniorSaver said:
    on September 8th at 11:26 am

    I see that Nationwide Bank (nationally available CDs) is today posting online a 5-year rate of 1.92% for non-jumbo CDs, and 1.97% for jumbo CDs, effective as of tomorrow. This is up, I think, from 1.76% and 1.81%, respectively. Maybe Nationwide saw that competitor State Farm Bank was at 2%. I hope other banks and credit unions will get the message that their 5-year rates aren’t cutting it in light of 5-year Treasury yields. I’m watching to see what GE Capital Retail Bank does tomorrow morning.