This is somewhat surprising timing for an uptick in savings rates given the latest announcements from the FED reaffirming the 2014 timeline for raising key rates. However, being relatively new in the online savings game, CiT likely made a smart move setting themselves apart from the competition in regards to rates.

Making More Sense of CiT’s Rate Hike:

Like we said CiT is relatively new, having only been on the seen for a few months. And since the release of their savings and CD products earlier this Spring they have been undergoing a fairly extensive marketing campaign.

As with every new online based savings account, you have to kind of take the market place by storm to receive much attention. And as a new savings account issuer, you really have only a few fronts to do this on. You can either come out with a new set of technological features that take advantage of user-requested capabilities like this, or with a new way of rewarding spending like this, or simply by offering the best rate – which is what CiT is doing.

CiT Bank recent rate history:

When CiT first issued this savings account it came with a still respectable 0.85% APY on daily balances of at least $25,000 or more. They then raised this rate to around 0.90% APY earlier this month and finally gave it an extra boost to it’s current level of 1.05% APY – allowing it to rest easily at the top of the charts (gaining them more exposure).

Our Take:

If you’re looking for an FDIC insured liquid savings account and have the required $25k in cash, then this is the way to go simply because you’ll be garnering the most in returns. However, like all money market and online savings accounts, the interest rate is variable and liable to change at anytime. Many new banks, or banks with a new online presence, come out of the gates sprinting with an enticing APY only to drop it once they’ve shored up enough new accounts. So I guess we’ll have to wait and see if CiT can maintain these attractive rate levels.

Today’s national average for money market accounts sits at just 0.50% APY on accounts with no minimum balance restrictions and just 0.66 % APY on balances of $25k or greater – making CiT’s offer close to double the national average. Compare all rates here.

The former “Community Bank” of Tampa Bay, Florida, is now rebranding themselves as “C1 Bank” and have issued this promotional offer as a grand-opening bonus….and to get themselves a little media attention.

The deal may not be all it’s cracked up to be though.

When you break down the annual percentage yield for this 5 year deposit it actually sits slightly below the national average at just 1.20% APY. On a 5 year CD, this comes out to a total of $61,294.04 in earnings on a $1 million deposit over the 60 month period – just enough for your pick of a Mercedes-Benz SLK350, SLK350, E350, ML350, or E350 Convertible.

You can actually choose any model of Benz that you’d like but if it exceeds the $61k mark (for precisely $1 million deposits) you’ll be stuck paying the difference. Also, don’t expect to be able to take the cash rather than the car either. C1 Bank has already inked the deal with Crown Eurocars in St. Petersburg, so you’ll need to sell it yourself if you’d rather have the cash (undoubtedly undercutting your earnings even further!).

This offer is available to residents in the state of Florida only! Stop by one of C1 Bank’s 19 locations with your Florida state issued ID to learn more about this offer.

Our take:

Dont look at this as anything other than a 5 year jumbo CD yielding just 1.20% APY. The fact that you can’t get the cash, or even your choice of auto-maker for that matter, make this offer seem like a lot of smoke and mirrors with little actual value.

To put the offer in further perspective, the current national average on 5 year deposits sits at 1.50% APY while the highest yielding 5 year CDs from our database sit well above the 1.20% mark at 1.80% APY.

Just today a number of congressmen and women demanded additional banking regulations in the wake of Chase Bank disclosing trading losses.

Chase – a commercial bank – has in the eyes of many, and particularly Michigan-Senator, Carl Levin, acted as a hedge fund with consumer deposits and cheap federal capital.

If you’re a deposit investor with Chase Bank, you’ve undoubtedly been a witness to their horrific consumer deposit rates, many of which are barely providing just half a percent in returns. Yet Chase Bank has (surprise) been making risky hedges with these funds.

Another Senator crying afoul on Chase Bank’s latest business practices, Oregon’s Jeff Merkley, had this to say when asked if he had a message for Chase Bank’s CEO, Jamie Dimon; ““Yes. If you want to be the head of a hedge fund, be a hedge fund,” Mr. Merkley said. “Terminate your access to the Fed’s discount window, terminate your access to deposits, and then we have no quarrel.”

He went on to state that current laws provide, “a big enough loophole that a Mack truck could drive right through it,” and a “license pretty much to do anything.”

Breaking Down the Banking Loophole:

1) Lets assume BankVibe started an actual Bank.

2) We then applied for and received FDIC insurance from the federal government. Meaning that we can protect our depositors under this governmental insurance program so that they will get all of their money back (from the FED, not us) if we happen to go belly up.

3) We then start collecting consumer deposits, paying between just 0.50% and 1.00% APY (national average for 12 month CD’s sits at 0.50%, while the national average for 3 year deposits sits at just 1.00% APY).

4) With the money collected from the deposits we then make investments through our subsidiary company that we’re allowed to create thanks to the reformation of the Glass-Steagall Act in 1999.

5) BankVibe then reaps the rewards of higher risk investments while paying only a paltry 0.50 to 1.0 percent in returns to our investors (aka depositors). If we lose depositors’ money from risky maneuvers and go under, the FDIC will foot the bill!

No risk for us!

So far in 2012, the top 5 year CD rates from online banks have peaked out at 1.80%, however, the top rates in Michigan for this particular term have sat comfortably above 2.00%.

Today’s Top Ten 5 Year CD Rates in Michigan (May, 2012):

1) First General Credit Union  (Muskegon, MI) – 5 year CD yielding 2.50% APY requiring a minimum deposit of $1,000.

2) Menominee County Federal Credit Union  (Stephenson, MI) – 5 year CD yielding 2.39% APY requiring a minimum deposit of $10,000.

3) Delta County Credit Union  (Wells, MI) – 5 year CD yielding 2.38% APY requiring a minimum deposit of $1,000.

4) Service 1 Federal Credit Union (Wells, MI) – 5 year CD yielding 2.33% APY requiring a minimum deposit of $500.

5) Great Lakes First Federal Credit Union (Rapid Rivers, MI) – 5 year CD yielding 2.27% APY requiring a minimum deposit of $1,000.

6) mBank (Traverse City, MI) – 5 year CD yielding 2.25% APY requiring a minimum deposit of $250.

7) Wings Financial Credit Union (Romulus, MI) – 5 year CD yielding 2.22% APY requiring a minimum deposit of $1.00.

8 ) CASE Credit Union (Okemos, MI) – 5 year CD yielding 2.15% APY requiring a minimum deposit of $500.

9) First Bank, Upper Michigan (Gladstone, MI) – 5 year CD yielding 2.12% APY requiring a minimum deposit of $500.

10) Upper Peninsula State Bank (Iron Mountain, MI) – 5 year CD yielding 2.10% APY requiring a minimum deposit of $500.

To put the offers above in perspective, the current national average for 5 year CD’s sits at roughly 1.49% APY.

As of March, 2012, the rate of inflation sat at 2.65%.

To be fair though the month of April is almost always an out-lier as a data point in month-to-month US budget data due to it being tax collecting season. However, many analysts still suggest this is a positive sign of things to come.

For all of us savers out there, the continuation of positive economic data can only speed up the time frame the FED has for raising interest rates (currently set for early 2014).

Recent (Positive) Economic Data:

Despite a variety of troubling economic data (rising inflation, shaky markets, European worries) there are still a number of positive data points to take note of. Below are two that likely pose the greatest impact in the short term.

- The number of US job openings available as of March 2012 rose to  3.7 million – also the largest number since 2008.

- Crippling gas prices may be on the decline. As of the end of April, oil has fell to it’s lowest level in four months.

Although their primary business operations are based in London, they now have offices here in the United States and can accept deposits from American consumers nationwide through their website. Compare Barclays rates vs. other online banks here.

Barclays Bank Online CD Rates (2012):

(Barclays Bank requires no minimum deposit on any of their savings products)

- 6 month CD yielding 0.55% APY.

- 12 month CD yielding 0.90% APY.

- 3 year CD yielding 1.40% APY.

- 5 year CD yielding 1.75% APY.

Their online savings account is featuring the highest APY when compared to the national average. As of May 2012, Barclays online savings account is providing an APY of 1.00%.

As we mentioned in our review of Barclays when they launched their CDs and savings accounts last month, Barclays has a decent assortment of features associated with their accounts. Our personal favorite is remote check deposit. Barclays customers can cash checks on the go via their smart phone (so long as its got a camera and internet connection). Remote deposit is the number 1 most desired feature in mobile banking this year!

Have you opened a Barclays savings or deposit online? If so, let others know what you think by leaving a comment!

From now until June 30, 2012, Chase Bank is giving away a $125 bonus for new customers who deposit $10,000 into a Chase checking account (use the promo code below).

Here’s the catch:

1) After 10 days of opening the checking account and making the initial $10,000 deposit, Chase Bank will then deposit the $125 into a Chase Savings account under your name.

2) You will need to add another $175 to this savings account as a $300 total balance is required to avoid a monthly fee.

3) Keep the money in the accounts for at least 30 days.

4) Use this coupon code: 4483497689710136

Our take:

Not too shabby considering a $125 bonus on a $10,000 deposit is a equivalent to a 1.25% return! Compare that with the top 12 month CD rates in your area and I’ll be they aren’t even close to that figure, plus you can earn this in just 30 days.

Also note that we have received this email from Chase Bank. In the promotion they say you’ll need to print out the email, however we’ve provided a screen shot of it below. In the past, BankVibe.com readers have suggested printing the screen shot and using the coupon code will suffice.

-Wisconsin Residents Only-

If you’re on the hunt for the highest yielding bank deposits, we’ve compiled the top 5 in your state. The current savings environment is terrible throughout the country, so don’t expect much of anything in the way of interest. In fact, as of May, 2012, the national average for 12 month CD rates nationwide sits at just 0.70% APY while the national average for 5 year CD rates sits at just 1.20% APY.

Income investors typically invest in bank deposits due to their relative low risk and as a hedge against inflation. However, since the brief period of deflation we saw in 2009, bank deposits haven’t been able to keep up with the rate of inflation. In 2012 inflation the rate of inflation has hovered right around 2.80%. Compare this to our highest yielding 12 month deposit available nationwide (1.15% APY) and you’ll see that even if you’re money is stashed away in a bank CD you’re still likely losing over 1% annually on your dollar’s buying power.

That said, many investors are still wary of upcoming economic data and enjoy the peace of mind that comes with deposits – even in grim savings environments.

Below are the highest yielding deposit rates in Wisconsin so far in 2012:

1) West Point Bank of Oshkosh, Wisconsin is providing 6 month CD’s yielding 0.90% APY requiring a minimum deposit of $1,000.

2) Community First Credit Union of Waupaca, Wisconsin is providing 12 month CD’s yielding 1.10% APY requiring a minimum deposit of $5,000.

3) Co-Op Credit Union of Strum, Wisconsin is providing 2 year CD’s yielding 1.35% APY requiring a minimum deposit of $1,000.

4) Bank of Augusta of Augusta, Wisconsin is providing 3 year CD’s yielding 1.75% APY requiring a minimum deposit of $1,000.

5) Headwaters State Bank of Presque Isle, Wisconsin is providing 5 year CD’s yielding 2.31% APY requiring a minimum deposit of $1,000.

- All CD’s mentioned above are FDIC insured up to $250,000. Visit their website(s) to learn more.

Have you opened a deposit account in Wisconsin with a higher yielding interest rate than the ones we’ve listed above? If so, let us know about it by leaving a comment!

NFCU is the largest credit union in the United States by both asset size and membership even though their membership is still relatively exclusive – allowing only those who have served in the United States military and their family members to join.

During the last couple of years we’ve seen a number of credit unions grow more lenient with membership restrictions. Even Pentagon Federal Credit Union has made membership more widely available – requiring just a $20 fee to the “National Military Family Association” or the “Voices for America’s Troops” foundations before joining. We’re still waiting, however, for NFCU to follow suit with lifting restrictions so that more consumers can take advantage of their products.

Navy Federal Credit Union CD Rates in 2012:

(Rates accurate as of April. Visit NavyFederal.org to see updated rates.)

- 3 month CD yielding between 0.50% APY and 0.70% APY depending on deposit size.

- 6 month CD yielding between 0.60% APY and 0.80% APY depending on deposit size.

- 12 month CD yielding between 0.85% APY and 1.05% APY depending on deposit size.

- 18 month CD yielding between 0.95% APY and 1.15% APY depending on deposit size.

- 24 month CD yielding between 1.05% APY and 1.25% APY depending on deposit size.

- 5 year CD yielding between 2.00% APY and 2.25% APY depending on deposit size.

- 7 year CD yielding between 2.50% APY and 2.75% APY depending on deposit size.

Compare these rates with the highest CD rates from credit unions in 2012.

Snapshot of GIC Federal Credit Union's CD Rates as of April 26, 2012

GIC Federal Credit Union out of Euclid, Ohio is currently featuring 6 month CD’s through 3 year CD’s with APY’s of 1.50%.

For a three year deposit this isn’t a fantastic yield but for 6 month deposits its almost 3x the national average, and twice the national average for 12 month deposits. To put the offer(s) in perspective the national average for 6 month CD’s currently sits at 0.45% APY while the national average for 12 month CDs currently sits at 0.75% APY.

Despite having a website that looks straight out of 1995, complete with sound effects, flashing buttons and an ugly color scheme, GIC Federal Credit Union is touting some seriously impressive savings rates that are far outside the norm. They even have a money market account with an advertised APY of 1.50% as well with a minimum deposit requirement of just $1,000. The rates are almost to good to be true in today’s savings environment which leaves us slightly skeptical.

About GIC Federal Credit Union:

We don’t know a whole lot about GIC Federal Credit Union besides the fact that they are a one branch credit union in a small town in Ohio. Their website seems pretty unprofessional and has typing errors throughout their text. Even their NCUA insurance limits are off. They’re NCUA disclaimer reads that all funds are protected up to $100,000 when that number actually got raised to $250,000 some time ago. They require a mail-in application to join which comes with a fee of $22.50, however we would recommend contacting the institution before applying.

Have you opened a deposit or money market account with GIC Federal Credit Union before? If so, let us know by leaving a comment!