Two banks compete for top 6-month CD rates
The same two banks have offered the same top nationally available deal on 6-month CDs for more than two months.
It's a continuing trend for this term.
The best offers have remained essentially unchanged for more than two years, holding just under 1% APY since November 2011. And there's little evidence to suggest we'll see higher CD rates in 2014.
CapitalSource Bank and Pacific Mercantile Bank are tied for the top spot, offering 0.90% APY, according to our most recent survey of the best nationally available 6-month CD rates.
The biggest difference between these two deals is the minimum deposit. CapitalSource requires a modest $1,000 minimum to open an account, while Pacific Mercantile wants a steeper $10,000 minimum.
The only way to make more money on a 6-month CD is to look for local deals from community banks and credit unions. Even the best of those picks pays just more than 1% APY.
For example, there are a couple of Corpus Christi, Texas, credit unions that pay 1.10% APY on 6-month CDs:
- Gulf Coast Federal Credit Union (www.ccgcfcu.com).
- NavyArmy Community Credit Union (www.navyarmyccu.com)
But you won't find deals like that everywhere, so here are the best nationally available 6-month certificates of deposit, as of today:
Top 6-month CD Rates
|Doral Bank Direct||0.87%||$500|
|Colorado Federal Bank||0.70%||$5,000|
|GE Capital Retail||0.65%||$25,000|
To qualify for this list, a bank must allow savers from all 50 states to buy its certificates of deposit online or through the mail.
Click here to compare these returns with the top CD rates from dozens of banks in your area.
Our CD calculator will help you figure out the interest you'll earn, for any term, amount and interest rate.
How to buy the top 6-month CD rates
|CapitalSource Bank||A Los Angeles-based lender to small and middle-market business with 21 branches in central and southern California.||www.capitalsourcebank.com|
|Pacific Mercantile Bank||A community bank with seven branches in southern California.||www.pmbank.com|
|Doral Bank Direct||The online bank of Doral Bank, the leading community bank in Puerto Rico, which also has five branches in northwest Florida and two in New York City.||www.doralbankdirect.com|
|Eh National||Which has a single branch in Beverly Hills, Calif.||www.ehnbank.com|
|AloStar Bank of Commerce||An online bank based in Birmingham, Ala., formerly known as Nexity Bank.||retail.alostarbank.com|
|GE Capital Bank||One of two online banks, each with its own FDIC insurance, that are subsidiaries of GE Capital Corp., the financial services unit of the manufacturing giant.||gecapitalbank.com|
|Colorado Federal Savings Bank||An online bank based in Greenwood Village, Colo.||www.coloradofederalbank.com|
|Giant Bank||The online division of Landmark Bank, which has two branches in Ft. Lauderdale, Fla.||www.giantbank.com|
|BAC Florida Bank||A community bank with one location in Coral Gables that sells its products nationally through My e-BAnC.||www.bacflorida.com|
|Discover Bank||An online bank owned by the credit card company.||www.discover.com|
|Virtual Bank||The online division of Sabadell United Bank, which has 23 branches in Florida, and is owned by Banco Sabadell, Spain's fourth-largest bank.||www.virtualbank.com|
|GE Capital Retail Bank||The other bank that's a subsidiary of GE Capital Corp.||banking.gecrb.com|
Over the past several decades, savers could usually count on earning something like 2% or 3% on a 6-month CD.
But the Federal Reserve has driven returns to record lows in an attempt to haul the economy out of the worst financial crisis and recession since the 1930s.
The government's bank-for-banks controls short-term interest rates by adjusting the federal funds rate. That's what commercial banks must pay to borrow money that other banks have on deposit with the Federal Reserve.
In December 2008, the Fed's rate-setting committee slashed that rate to essentially zero in an attempt to spur lending and boost the economy.
Since then, the average return on 6-month CDs has fallen from 1.86% APY to a record low of 0.14% APY today.
In late 2012, Fed Chairman Ben Bernanke said the central bank would start bumping rates up when the unemployment rate hit 6.5%.
With that goal in mind, savers anxiously watched the jobless rate fall to 7.3% in August. Not quite there, but closing in.
Then Bernanke told a news conference after the Fed's rate-setting committee met on Sept. 18 that “the first increases in short-term rates might not occur until the unemployment rate is considerably below 6.5%."
Indeed, the Fed chairman said a return to market-driven rates — and a reasonable return on our savings — could be "several more years" down the road.
Contributing editor Darci Swisher contributed to this report.
Mitch Strohm on Google Plus.