What began as a war of words between the American Bankers Association (ABA) and Ally Bank has finally yielded an outcome that should satisfy the FDIC and make the ABA happy – Ally Bank has lowered its CD rates.
Granted, Ally’s rates were one of the most rewarding in the market where banks were just continually lowering deposit rates. However, Ally’s interest rates certainly weren’t off-the-charts high, and many consumers were disappointed with the ABA move. Ally customers had hoped that Ally/GMAC Financial executives would stand by their earlier stance that “GMAC/Ally is among the best capitalized banks in the country… with a stated commitment to provide leading rates,” and then maintained their higher-than-average rates.
Instead, Ally went and made some substantial rate cuts and the savers have lost another one of the better alternatives around for savings and CDs. Some of the bank’s products that have gotten the most sizable reductions are the following:
|Term||Last 06/04/09||New Rate 06/05/09||Change %|
|Ally 3 month CD||1.70%||1.60%||-0.10%|
|Ally 6 month CD||2.10%||2.00%||-0.10%|
|Ally 9 month CD||2.60%||1.90%||-0.70%|
|Ally 12 month CD||2.80%||2.49%||-0.31%|
|Ally 18 month CD||2.60%||2.40%||-0.20%|
|Ally 24 month CD||2.75%||2.55%||-0.20%|
|Ally 36 month CD||3.10%||3.00%||-0.10%|
|Ally 48 month CD||3.25%||3.00%||-0.25%|
|Ally 60 month CD||3.50%||3.50%|
The 9-month No-Penalty also went down by 20 BPS from 2.50% APY to 2.30% APY. Other products that were also cut by -20 BPS are the savings account, 18-month, and 24-month CDs. The rest of the CDs were reduced by at least -10 BPS, while the Money Market Account and the 60-month CD remained unchanged.
On a positive note, even with the significant cuts, Ally still offers some of the most competitive interest rates around.