NEW YORK – RateWatch, a premier banking data and analytics service owned by TheStreet, Inc. (NASDAQ: TST), reported today that national averages for CD rates of all durations this week remained unchanged as the Federal Reserve continued to keep the short-term federal funds rate at a range of zero to 0.25% since late 2008.
"Savers remain in limbo because the Federal Reserve has repeated that it won’t lift the federal funds rate anytime soon, but a growing number of economists are arguing that the central bank will have to increase interest rates sooner than many market participants anticipate," reported Joe Deaux, TheStreet’s Economics Analyst. "For now, savers can expect few changes in average national CD rates, but they also shouldn’t be shocked if that shifts by the end of 2014."
NATIONAL AVERAGE RESULTS - $10K
Avg Rate This week | Avg Rate Last week | |
---|---|---|
Money Market | 0.15% | 0.15% |
1 month CD | 0.11% | 0.11% |
3 month CD | 0.15% | 0.15% |
6 month CD | 0.23% | 0.23% |
1 year CD | 0.36% | 0.36% |
2 year CD | 0.55% | 0.55% |
3 year CD | 0.75% | 0.75% |
4 year CD | 0.93% | 0.93% |
5 year CD | 1.15% | 1.15% |
In the Greater San Jose Region area, the average 5-year CD rate sat at 0.84%, lower than the national average of 1.15%. Rates on the 5-year CD ranged from 0.15% on the low end to 2.0% at the high end, which can be found at Compass Bank. The average 3-year CD rate in Greater San Jose Region was 0.5% with a range of 0.05% to 1.1% found at BBCN Bank. And if you are on the market for a 1-year CD, take a look at Hanmi Bank, which currently offers a rate of 0.8% as compared to the Greater San Jose Region average of 0.24%. Other top rate issuers can be found in the tables that follow.
GREATER SAN JOSE REGION AVERAGE RESULTS - $10K
Avg Rate This week | Highest Available Rate | Highest Available Rate Issuer | |
---|---|---|---|
Money Market | 0.08% | 0.4% | Hanmi Bank |
1 month CD | 0.06% | 0.15% | Torrey Pines Bank |
3 month CD | 0.1% | 0.4% | Hanmi Bank |
6 month CD | 0.16% | 0.7% | Hanmi Bank |
1 year CD | 0.24% | 0.8% | Hanmi Bank |
2 year CD | 0.37% | 1.0% | Hanmi Bank |
3 year CD | 0.5% | 1.1% | BBCN Bank |
4 year CD | 0.65% | 1.5% | First Republic Bank |
5 year CD | 0.84% | 2.0% | Compass Bank |
TOP RATE ISSUERS - $10K
This is a list of issuers with top interest rates in the Greater San Jose Region area. The issuer's Financial Strength Rating is an independent, unbiased evaluation of quarterly regulatory statements. Institutions are assigned a letter grade of A-E with "A" representing the highest rating based on a review of many aspects of financial safety including capitalization, asset quality, profitability and liquidity. For more information, visit www.weissratings.com/help/what-our-ratings-mean.aspx. Information is believed to be accurate, but not guaranteed.
Money Market | Financial Strength Rating | Minimum to Earn Interest ($) | APY(%) |
---|---|---|---|
Hanmi Bank 408-260-3400 www.hanmi.com | B | 10000 | 0.4 |
Cathay Bank 408-262-0280 www.cathaybank.com | B | 10000 | 0.15 |
Far East National Bank 408-342-8000 www.fenb-us.com | B | 10000 | 0.15 |
Luther Burbank Savings 650-688-7410 www.lutherbsavings.com | B | 10000 | 0.15 |
Compass Bank 408-341-8700 www.bbvacompass.com | C+ | 10000 | 0.15 |
1 Month CD | Financial Strength Rating | Minimum to Earn Interest ($) | APY(%) |
Torrey Pines Bank 650-469-1700 www.torreypinesbank.com | B | 5000 | 0.15 |
Hanmi Bank 408-260-3400 www.hanmi.com | B | 1000 | 0.1 |
Far East National Bank 408-342-8000 www.fenb-us.com | B | 10000 | 0.1 |
Compass Bank 408-341-8700 www.bbvacompass.com | C+ | 1 | 0.1 |
East West Bank 408-279-0668 www.eastwestbank.com | B+ | 10000 | 0.1 |
3 Month CD | Financial Strength Rating | Minimum to Earn Interest ($) | APY(%) |
Hanmi Bank 408-260-3400 www.hanmi.com | B | 1000 | 0.4 |
BBCN Bank 408-557-2000 www.bbcnbank.com | C+ | 1000 | 0.3 |
Torrey Pines Bank 650-469-1700 www.torreypinesbank.com | B | 5000 | 0.2 |
Luther Burbank Savings 650-688-7410 www.lutherbsavings.com | B | 1000 | 0.2 |
Far East National Bank 408-342-8000 www.fenb-us.com | B | 10000 | 0.15 |
6 Month CD | Financial Strength Rating | Minimum to Earn Interest ($) | APY(%) |
Hanmi Bank 408-260-3400 www.hanmi.com | B | 1000 | 0.7 |
BBCN Bank 408-557-2000 www.bbcnbank.com | C+ | 1000 | 0.6 |
Cathay Bank 408-262-0280 www.cathaybank.com | B | 2500 | 0.35 |
Far East National Bank 408-342-8000 www.fenb-us.com | B | 10000 | 0.3 |
CTBC Bank 408-873-3288 www.ctbcbankusa.com | C+ | 1500 | 0.3 |
1 Year CD | Financial Strength Rating | Minimum to Earn Interest ($) | APY(%) |
Hanmi Bank 408-260-3400 www.hanmi.com | B | 1000 | 0.8 |
BBCN Bank 408-557-2000 www.bbcnbank.com | C+ | 1000 | 0.8 |
Cathay Bank 408-262-0280 www.cathaybank.com | B | 2500 | 0.5 |
Far East National Bank 408-342-8000 www.fenb-us.com | B | 10000 | 0.45 |
Compass Bank 408-341-8700 www.bbvacompass.com | C+ | 1 | 0.45 |
2 Year CD | Financial Strength Rating | Minimum to Earn Interest ($) | APY(%) |
Hanmi Bank 408-260-3400 www.hanmi.com | B | 1000 | 1.0 |
BBCN Bank 408-557-2000 www.bbcnbank.com | C+ | 1000 | 1.0 |
Compass Bank 408-341-8700 www.bbvacompass.com | C+ | 1 | 0.85 |
Bank Leumi USA 650-289-2400 www.leumiusa.com | C | 10000 | 0.8 |
Cathay Bank 408-262-0280 www.cathaybank.com | B | 2500 | 0.7 |
3 Year CD | Financial Strength Rating | Minimum to Earn Interest ($) | APY(%) |
BBCN Bank 408-557-2000 www.bbcnbank.com | C+ | 1000 | 1.1 |
First Republic Bank 408-999-0242 www.firstrepublic.com | B+ | 10000 | 1.1 |
Hanmi Bank 408-260-3400 www.hanmi.com | B | 1000 | 1.05 |
Bank of the West 408-947-5005 www.bankofthewest.com | B | 10000 | 1.0 |
Cathay Bank 408-262-0280 www.cathaybank.com | B | 2500 | 0.9 |
4 Year CD | Financial Strength Rating | Minimum to Earn Interest ($) | APY(%) |
First Republic Bank 408-999-0242 www.firstrepublic.com | B+ | 10000 | 1.5 |
Bank of the West 408-947-5005 www.bankofthewest.com | B | 10000 | 1.5 |
Umpqua Bank 408-755-4800 www.umpquabank.com | B- | 10000 | 1.41 |
Bank Leumi USA 650-289-2400 www.leumiusa.com | C | 10000 | 1.1 |
Compass Bank 408-341-8700 www.bbvacompass.com | C+ | 1 | 1.05 |
5 Year CD | Financial Strength Rating | Minimum to Earn Interest ($) | APY(%) |
Compass Bank 408-341-8700 www.bbvacompass.com | C+ | 1 | 2.0 |
First Republic Bank 408-999-0242 www.firstrepublic.com | B+ | 10000 | 1.9 |
Umpqua Bank 408-755-4800 www.umpquabank.com | B- | 10000 | 1.76 |
Bank of the West 408-947-5005 www.bankofthewest.com | B | 10000 | 1.5 |
Bank Leumi USA 650-289-2400 www.leumiusa.com | C | 10000 | 1.35 |
Data is surveyed weekly with averages calculated each Monday afternoon from RateWatch's unbiased national interest rate survey of over 96,000 financial institution locations across the United States.
More About CDs:
CDs, or certificate of deposits, are bank-issued promissory notes wherein an investor deposits money for a set amount of time and, provided the money remains untouched, receives interest on the total sum when the investment matures.
While the money can't be accessed during that time (without incurring penalties), the advantage of a CD over a regular savings deposit is the higher rate of interest. Typically, a CD can be taken out on as few as three-month terms but can range to up to five years; generally, the longer the timeframe the higher rate of interest.
CD Laddering:
To provide further financial security, a CD laddering strategy offers conservative investors the opportunity to stagger their capital across numerous deposits set to expire at different intervals. Not only does this hedge against variable rate fluctuations by offering a guaranteed return at a locked-in interest rate, it also increases liquidity given that one CD will mature at predictable and established intervals.
Using an example of a five-year ladder strategy, an investor would divide his or her money amongst one-, two-, three-, four-, and five-year CDs. Once the one-year deposit matures, he or she will reinvest the money into a five-year CD, and will do so every subsequent year upon each CD's maturation. In this way, the investor has a CD that matures each year and thus, steady income from the interest on the maturing investments.
Nevertheless, investors must keep in mind that the onus of developing a ladder strategy is on the investor, not the bank or financial institution. In developing a strategy, map out each rung of the ladder, determining how long you want to invest for, the kind of return you are targeting and the length of time you can tolerate not having access to the principal and interest.
About RateWatch
For over 20 years, RateWatch has been the premier provider of competitive interest rate and product information to financial institutions across the United States. Consistently providing top quality, highly relevant data RateWatch maintains the largest database in the industry with deposit, loan, and fee information monitoring over 96,000 locations. Rate surveys, product comparisons, financial strength reporting, local/regional/national averages, fee reporting, specialty reports and more are available. To learn more about RateWatch, visit www.rate-watch.com. RateWatch is a division of TheStreet, Inc.