High Yield Checking Accounts are Still Solid

A little over a year ago, the market was nearly saturated with high-yield or high reward checking accounts.  Some of these offerings had us wondering if this was too good to be true, and how long it could be sustained.  We recently decided to take another look to see whether or not these rates have remained high over a year later.  What is surprising is that apart from one notable exception, the rates have remained high.  Yes, they have slid somewhat, but checking account interest rates have not fallen as much as the other account types.  They still yield more returns than the most attractive CDs (for more information on the various account types and how they are different from one another, you can refer to The ABCs of Rewards Checking).

The only bank that bucked the trend and cut its rates is Malvern Federal Savings Bank near Philadelphia.  In March of 2009, having a checking account there would have given you 5.01% APY, that figure has dropped substantially to 1.50% APY.  By contrast, the MAXimum Free account at Focus Bank, with 12 branches in Arkansas and Missouri, was and is now paying out a solid 4.51% APY.

In Oklahoma, AmericaNet and two jointly-owned banks were giving 5.25% APY last spring, and while they have cut this quite a bit, the current offering of 4.00% APY is still very good.   Until just recently, Bank of the Sierra, which has dozens of branches all over central California, was able to maintain a 4.51% APY, just a few months ago, they lowered it to 4.09% APY.  Union State Bank was at 5.01% APY last year, but has since cut its rate to 3.25% APY.  Union State Bank has 4 branches in Kansas.  In Tampa FL, Patriot Bank was at 4.01% APY last year, but is now down to 3.01% APY.  Apart from AmericaNet and Bank of Sierra, all of the banks mentioned now limit new accounts to their state or locality.

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