Internet Enables Chesapeake, EBSB and Acacia Banks to Quickly Raise Money with Promotional Savings Rates

Promotional savings rates - especially those where the bank commits to locking a certain rate for a certain period - are a win-win.

Banks need deposits and in this environment often need them quickly.

So far, in 2009 alone, we have seen a couple of banks quickly raise large amounts of deposits with promotional savings rates.   Cheasapeake Bank launched ClearSkies, an online banking arm, to offer depositors a 3 month lock on a 3.75% earlier this year.  The promotion was so successful that the bank quickly lowered its rate because it got more deposits than it needed.  East Boston Savings Bank recently followed suit with a 4 month lock on a 2.82% rate, which it recently lowered for the same reason.  Currently, Acacia Federal Savings Bank is offering a 4 month lock on a 2.25% rate.

Promotional savings rates, especially those where the bank commits to locking a certain rate for a certain period - are a win-win situation.  With the distribution on the internet, and site such as BestCashCow.com, the information on these rates gets out quickly and enables banks to quickly raise the funds that they need.  Depositors wind up with a rate that is well in excess of comparable-length CDs.  Additionally, depositors can rest assured that the banks usually will need to remain competitive after the guarantee date.

Ari Socolow
Ari Socolow: Ari Socolow is the Chief Economist and Editor-in-Chief at BestCashCow. He is particularly interested in issues relating to financial literacy and bank transparency. Since co-founding this website in 2005, Ari has been frequently cited in the media as an expert on local and national savings accounts, CD products, mortgage and loan products and credit card rewards products.

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