After the rates cuts that CDs had at the close of last week, it’s refreshing to see current CD rate averages without any of the “red marks” that were present in the previous week’s comparison table.
The positive changes however, were only for the 24-month, 36-month, and 60-month CDs, and with very modest increases at that. Average CD rates for the 6-month, 12-month, and 48-month CDs remained unchanged. Still, it’s better than the continuous slide that CD rates have taken to lately.
CD rate hikes this week
So which banks contributed to the minimal increases in our CD rate averages? Of the banks we track here, the following banks adjusted their rates this week to give better offerings to consumers:
CD Rate Hikes September 11, 2009
| Bank Name | Product | Old Rate | New Rate | % Change |
|---|---|---|---|---|
| Citibank | 60 month CD | 3.00% | 3.50% | +0.50% |
| ING Direct | 12 month CD | 1.50% | 1.85% | +0.35% |
| Chase | 24 month CD | 2.00% | 2.15% | +0.15% |
| StoneBridge Bank | 60 month CD | 2.40% | 2.75% | +0.35% |
| 36 month CD | 2.25% | 2.50% | +0.25% | |
| 24 month CD | 2.00% | 2.10% | +0.10% | |
| 12 month CD | 1.65% | 1.75% | +0.10% | |
| 6 month CD | 1.25% | 1.40% | +0.15% | |
| Umbrella Bank | 12 month CD | 2.00% | 2.15% | +0.15% |
| 9 month CD | 1.60% | 1.85% | +0.15% |
CD rate cuts this week
While the rate drops seen this week were fortunately, too few and not quite substantial enough to actually pull down CD rate averages; some may still be worth mentioning:
CD Rate Cuts September 11, 2009
| Bank Name | Product | Old Rate | New Rate | % Change |
|---|---|---|---|---|
| ING Direct | 6 month CD | 1.65% | 1.55% | -0.10% |
| AIG Bank | 36 month CD | 2.66% | 2.61% | -0.05 |
| 18 month CD | 2.11% | 2.06% | -0.05% | |
| 12 month CD | 2.01% | 1.96% | -0.05% | |
| Bank of America | 9 month no penalty CD | 0.75% | 0.70% | -0.05% |
Economy recovering — but what about interest rates?
Echoing the sentiments of Fed Chairman Ben Bernanke and other financial analysts, Treasury Secretary Timothy Geithner said before the Congressional Oversight Panel Thursday that the country has now passed from “rescuing the economy” to “repairing and rebuilding the foundation for future growth,” meaning, the worst is over. At the same time, he cautioned that there is still “a long way to go before true recovery takes hold.”
Mr. Geithner also revealed that even as the federal government winds down its financial rescue programs, it also expects the banks which benefited from the government aid to pay some $50 billion back to the government in the next 12 to 18 months.
A recovering economy and stabilized banking industry is all well and good. But what exactly does that bode for bank depositors? At this point, what consumers would perhaps like to hear is not only banks repaying their debts to the government but that they are also giving the country’s savers better investment options and higher yields for their funds.
