AIG Bank is offering some pretty competitive CDs. The question is, with all of the hoopla over executive compensation, would you open one?

The rate on their 60-month CD is 3.41% APY versus a top 60 month CD rate of 3.81% APY according to the BestCashCow rate tables. Rates are also competitive across other terms.

AIG Federal Savings Bank is heaquartered out of Deleware and has a Bauer rating of 3 out of 5 stars for safety and soundness, which isn't bad. Remember that most of AIG was a well-run, profitable business. It was just the hotshots in their CDS and other structured insurance product departments that brought down the company.

So, what about it? Would you deposit money in AIG Bank? What about if they had the top rate across in all CD categories.

Short-term CDs just aren’t attractive at the moment. The 10-year Treasury is now pushing 4% - changing the entire yield curve. While the Fed may try desperately to hold rates low, but the reality is that inflation is a real threat at the moment. If we do see inflation, savings and money market rates will quickly go up. Since savings rates are very close to, and in many cases – above, short term CD rates, they are your better bet. There is a real risk of higher rates, and if they were to fall, they don’t have far to fall anyway.

See the best CD rates here.

First Trade Union Bank is offering a 3% APY 36-month CD. As rates continue to fall, anything at 3% or above is starting to look good.

First Trade Union is based in Boston and has been competitive on the rate tables for the past six months.

The only downside to First Union is the mail-in application. Still, as others have pointed out, the process is as good as can be expected from a paper application process. Neil writes on the First Trade Union page:

"The process to open an account at FTUB is as easy as can be expected with a mail-in application. Overall, my opening of a new account went as fast (or faster) at FTUB as with accts that can accept an immediate ACH transfer for funding. The requirement for mailing in your application and funding check should not be considered a total negative. My experience with "immediate" ACH funding is that it's not really "immediate". Don't ever expect to be able to transfer $ from an existing account into a newly-opened account (at FTUB or anywhere else) in a day or two. Not gonna happen. The set-up of this account went faster than setting up at some other banks that did not require postal application."

First Trade Bank has received 5 out of 5 stars (Excellent) from Bauer Financial for its safety and soundness.

Compare the best 36-month CD rates.