bank rates

PNC Makes Its CD Rates A Little Less Awful

Now that the Federal Reserve has finally begun nudging interest rates up, we’ve been on high alert for higher CD yields.

While we haven’t seen any movement in the top nationally available returns, another kind of increase caught my eye this week.

PNC Bank, the nation’s sixth-largest bank by assets and fifth-largest by number of branches, revised its CD rate sheet upward across several terms, boosting yields as much as 25 times higher than it was previously offering.

Granted, PNC had about the worst-paying rate sheet of about a hundred I regularly see, offering a barely-there 0.04% APY on all of its basic term CDs from 6 months up to 84 months.

(Yes, you read that right. In exchange for socking away your money with PNC for 7 years, the bank was willing to pay you 0.04% interest.)

But now it appears PNC’s turned over a new leaf, paying the following on a $25,000 deposit:

  • 0.10% APY on 6-month CDs
  • 0.20% APY on 12-month CDs.
  • 0.33% APY on 24-month CDs.
  • 0.38% APY on 36-month CDs.
  • 0.65% APY on 48-month CDs.
  • 0.90% APY on 60-month CDs.
  • 1.05% APY on 84-month CDs.

It’s hard not to deduce that these substantially large increases from PNC are one of the first results we’re seeing from the Fed raising rates last month.

It’s also likely the second Fed ripple we’re seeing from the nation’s biggest banks, after reporting two weeks ago on the sudden appearance of truly competitive rates from Wells Fargo on some brokered CDs.

Don’t get me wrong. These rates still aren’t worth a savvy saver’s investment.

About the best you can say is that PNC’s 60-month return narrowly beats the national average of 0.84% APY in this week’s Bankrate survey.

As I wrote last week, the really big banks are notoriously poor places to open a CD, with rates that don’t even approach the tepid national averages of banks and thrifts across the nation.

And forget about comparing them to the top national rates, which tower so ridiculously far above the big bank rates that it’s almost laughable, if it weren’t so pitiful.

But there’s no denying that a yield increase such as 0.04% to 0.90% APY on a 5-year certificate of deposit – from a bank that operates almost 2,800 branches in 21 Eastern, Southern and Midwestern states – is a significant development.

Here’s hoping this is a sign of the ball getting rolling.

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