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High Interest Savings Accounts Profiles

Posted By Jim On 01/27/2009 @ 6:52 am In Personal Finance | 20 Comments

The high interest rates of online banks may be appealing, but before you open an account, it pays to do a little research to learn more about the bank itself.

When Dollar Savings Direct [3] first appeared with its amazingly high interest rate, I know I was one of the first customers to sign up. The 4.00% APY savings account was amazing, as other banks dropped to 3% or lower. I saw the FDIC emblem, I saw that it was affiliated with Emigrant Direct and Emigrant Bank, but I never confirmed it. I did a little bit of research and discovered that it was once branded Banco Fortuna, Emigrant’s aborted attempt into the Spanish-speaking market. I was satisfied and opened an account. Thankfully, astute readers investigated further, even calling up the FDIC, and we learned that Dollar Savings Direct was FDIC insured but shared that protection with Emigrant Direct. In other words, having a Dollar Savings Direct account, for FDIC insurance purposes, was the same as having another Emigrant Direct account, the combined assets would be protected up to $250,000. I did not know that when I opened the account and while it wouldn’t have affected me, I should’ve known.

So here’s a brief history and discussion about the banks I consider to the best high interest savings accounts [4]:

Everbank

Everbank [5] is most well known for their foreign currency CDs, a banking product that very few other banks (none amongst the online banks) offer, but they’ve been around for quite some time. Their FDIC certificate states they were founded in 1998 but I have to believe that’s more their bank offerings than their business lifetime, they spent much of their time as a mortgage lending institution before taking on deposits. They’ve seen acquired plenty of accolades from industry publications including Money Magazine “Best of the Breed” in 2007, Kiplinger’s “Best Checking Account” in 2006, and a five time recipient of Forbes.com Best of the Web award from 2000 to 2005. If you’re in the mood for trophy cases, you can view their long list of awards [6].

Bankrate Ratings & Report:
They are given four stars from Bankrate’s Safe and Sound rankings, you can review their comments here [7].

Everbank Bank Stats: (as of Sept 30, 2008)

  • Founded: 1/1/1998
  • Deposit Insurance Date: 1/1/1998
  • Address: 501 Riverside Avenue, Jacksonville, FL 32202
  • FDIC Certificate: #34775 [8]
  • ABA Routing Number: 063000225
  • Total Employees: 1,474
  • Total Deposits: $4.0952 billion

FNBO Direct

FNBO Direct [9] is the online banking offering of First National Bank Omaha, which is itself a subsidiary of First National of Nebraska. First National Bank opened in 1857 and was first covered by FDIC insurance in 1934, when the program was launched. First National Bank Omaha is a full service bank, offering both retail and business banking services, investment and wealth management.

Bankrate & Bauer Financial Ratings:
They are awarded four stars from Bauer Financial and four stars from Bankrate’s Safe and Sound rankings, you can review their comments on First National Bank of Omaha here [10].

FNBO Direct Bank Stats: (as of Sept 30, 2008)

  • Founded: 1/1/1857
  • Deposit Insurance Date: 1/1/1934
  • Address: 16th and Dodge Streets, Omaha, NE 68197
  • FDIC Certificate: #5452 [11]
  • ABA Routing Number: 104000016
  • Total Employees: 3,838
  • Total Deposits: $8.1430 billion

E*Trade Bank

E*Trade Bank [12] is affiliated with, but separate from, the more well-known E*Trade Securities brokerage. One of the nice features about opening an E*Trade Bank account is that you can easily link your brokerage account to the savings account, creating your very own deposit sweep account. E*Trade Bank itself has won a few awards itself, including a Money Magazine Best of the Breed in 2007, and the brokerage firm has consistently high rankings in Smart Money’s Best Discount Brokers listings [13] (2008 results [14]).

Bankrate Ratings & Report:
They are given two stars from Bankrate’s Safe and Sound rankings, you can review their comments here [15].

E*Trade Bank Stats: (as of Sept 30, 2008)

  • Founded: 1/1/1933
  • Deposit Insurance Date: 6/23/1955
  • Address: 671 N. Glebe Road, 16th Floor, Arlington, VA 22203
  • FDIC Certificate: #30746 [16]
  • ABA Routing Number: 256072691
  • Total Employees: 269
  • Total Deposits: $31.0141 billion

HSBC Direct

If you’ve done a little bit of international travel, you’ll probably recognize the name HSBC, which stands for Hongkong and Shanghai Banking Corporation, because it’s an international powerhouse. Unfortunately, if you have any of their accounts, you’ll also know that each account in each country is segregated from one another, which can sometimes be a bit of a headache. Well, independent of that, HSBC Direct [17] is the United States-based online bank offering from HSBC, under HSBC Bank USA, and has been growing very quickly.

Bankrate Ratings & Report:
They are given two stars from Bankrate’s Safe and Sound rankings, you can review their comments here [18].

HSBC Direct Bank Stats: (as of Sept 30, 2008)

  • Founded: 7/1/2004
  • Deposit Insurance Date: 7/1/2004
  • Address: 1800 Tysons Blvd, McLean, Virginia 22102
  • FDIC Certificate: #57890 [19]
  • ABA Routing Number: 022000020
  • Total Employees: 11,595
  • Total Deposits: $124.8762 billion

ING Direct

ING Direct [20] was probably the first online bank, back when people were wary of doing all of their banking online and they offered eye-popping rates. When you were used to less than 1.00% APY on you savings, ING was willing to give you 5% or more. It was absolutely bananas. ING Direct is the online banking offering of ING Group, an international financial services company that operates in over 50 countries in the area of banking, investments, insurance, and retirement. They are headquartered in Amsterdam, Netherlands, and were created in 1991 when Nationale-Nederlanden, a Dutch insurer, and NMB Postbank Groep, a Dutch bank, merged together. ING Direct is one of the six business lines of the company, separate from its Retail Banking and Wholesale Banking business lines. Not to be left out of the award lovefest, Money Magazine called ING Direct “the best money market account in the country.”

Bankrate Ratings & Report:
They are given four stars from Bankrate’s Safe and Sound rankings, you can review their comments here [21].

ING Direct Bank Stats: (as of Sept 30, 2008)

  • Founded: 8/4/2000
  • Deposit Insurance Date: 8/4/2000
  • Address: 1 S. Orange Street, Wilmington, DE 19801
  • FDIC Certificate: #35489 [22]
  • ABA Routing Number: 0311761100
  • Total Employees: 2,281
  • Total Deposits: $69.1191 billion

WT Direct

WTDirect [23] is the online banking account for Wilmington Trust Federal Savings Bank, a bank headquartered in Baltimore, Maryland. I know the least about Wilmington Trust and WTDirect because they haven’t been among the leaders in terms of interest rates, with their online bank offering around 3% if you have a balance over $10,000, but they are FDIC insured. The parent company is a full service financial company with business and retail banking as well as wealth advisory services.

Bankrate Ratings & Report:
They are given three stars from Bankrate’s Safe and Sound rankings, you can review their comments here [24].

WTDirect Bank Stats: (as of Sept 30, 2008)

  • Founded: 6/10/1994
  • Deposit Insurance Date: 6/10/1994
  • Address: 111 S. Calvert Street, Ste 2620, Baltimore, MD 21202
  • FDIC Certificate: #33911 [25]
  • ABA Routing Number: 052173464
  • Total Employees: 361
  • Total Deposits: $610.0240 million

Bank of Internet

I know very little about Bank of Internet but at the request of Peter I did a little digging about them. They’re FDIC insured and publicly traded (BOFI [26]) with a full range of bank services like checking, savings, and certificates of deposit. They have no branches and operate entirely over the internet, though their headquarters are in San Diego, California.

Bankrate Ratings & Report:
They are given three stars from Bankrate’s Safe and Sound rankings, you can review their comments here [27].

WTDirect Bank Stats: (as of Sept 30, 2008)

  • Founded: 7/4/2000
  • Deposit Insurance Date: 7/4/2000
  • Address: 12777 High Bluff Dr #100, San Diego, CA 92130
  • FDIC Certificate: #35546 [28]
  • ABA Routing Number: 122287251
  • Total Employees: 47
  • Total Deposits: $560.8120 million

Is there an online bank you think I should add to the list?

(Photo: refractedmoments [29])


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URLs in this post:

[1] Tweet: http://twitter.com/share

[2] Email: mailto:?subject=http://www.bargaineering.com/articles/high-interest-savings-accounts-profiles.html

[3] Dollar Savings Direct: http://www.bargaineering.com/articles/dollar-savings-direct-is-an-emigrant-direct-clone.html

[4] best high interest savings accounts: http://www.bargaineering.com/articles/top-5-online-banks-savings-or-checking-accounts.html

[5] Everbank: http://www.bargaineering.com/articles/r/everbank.php?tag=highInterestBankProfilesBNR

[6] long list of awards: http://www.everbank.com/004Awards.aspx?referId=12718

[7] here: http://www.bankrate.com/rates/safe-sound/memorandums-memos.aspx?fedid=1000215115&pid=p:brg

[8] #34775: http://www2.fdic.gov/idasp/externalConfirmation.asp?inCert1=34775

[9] FNBO Direct: http://www.bargaineering.com/articles/r/fnbodirect.php?tag=highInterestBankProfilesBNR

[10] here: http://www.bankrate.com/rates/safe-sound/memorandums-memos.aspx?fedid=527954&pid=p:brg

[11] #5452: http://www2.fdic.gov/idasp/externalConfirmation.asp?inCert1=5452

[12] E*Trade Bank: http://www.bargaineering.com/articles/r/etrade.php?tag=highInterestBankProfilesBNR

[13] Best Discount Brokers listings: http://www.bargaineering.com/articles/best-online-discount-brokers.html

[14] 2008 results: http://www.smartmoney.com/investing/economy/smartmoneys-2008-broker-survey-23138/

[15] here: http://www.bankrate.com/rates/safe-sound/memorandums-memos.aspx?fedid=1000205848&pid=p:brg

[16] #30746: http://www2.fdic.gov/idasp/externalConfirmation.asp?inCert1=30746

[17] If you’ve done a little bit of international travel, you’ll probably recognize the name HSBC, which stands for Hongkong and Shanghai Banking Corporation, because it’s an international powerhouse. Unfortunately, if you have any of their accounts, you’ll also know that each account in each country is segregated from one another, which can sometimes be a bit of a headache. Well, independent of that, HSBC Direct: http://www.bargaineering.com/articles/r/hsbcdirect.php?tag=highInterestBankProfilesBNR

[18] here: http://www.bankrate.com/rates/safe-sound/memorandums-memos.aspx?fedid=413208&pid=p:brg

[19] #57890: http://www2.fdic.gov/idasp/externalConfirmation.asp?inCert1=57890

[20] ING Direct: http://www.bargaineering.com/articles/r/ingdirect.php?tag=highInterestBankProfilesBNR

[21] here: http://www.bankrate.com/rates/safe-sound/memorandums-memos.aspx?fedid=1000116782&pid=p:brg

[22] #35489: http://www2.fdic.gov/idasp/externalConfirmation.asp?inCert1=35489

[23] WTDirect: http://www.bargaineering.com/articles/r/wtdirect.php?tag=highInterestBankProfilesBNR

[24] here: http://www.bankrate.com/rates/safe-sound/memorandums-memos.aspx?fedid=1000212090&pid=p:brg

[25] #33911: http://www2.fdic.gov/idasp/externalConfirmation.asp?inCert1=33911

[26] BOFI: http://finance.google.com/finance?q=BOFI

[27] here: http://www.bankrate.com/rates/safe-sound/memorandums-memos.aspx?fedid=1000516456&pid=p:brg

[28] #35546: http://www2.fdic.gov/idasp/externalConfirmation.asp?inCert1=35546

[29] refractedmoments: http://www.flickr.com/photos/refractedmoments/223052548/sizes/s/

Thank you for reading!