The head of the American Banker’s Association complained in this letter to Sheila Bair, Chairman of the FDIC, that Ally Bank’s CD rates and savings rates were too high. They find it to be “egregious” that this former GMAC bank is offering such tantalizing rates given the government stake in GM. While the trade group (of which Ally is not a part of) feels that these “high” deposit rates are anti-competitive and they’re crying foul, in my opinion, since these are FDIC-insured instruments, for individual investors in the market for a CD, now’s the time to get while the gettin’s good!
Why not take advantage of these highest rates around now before they’re potentially forced to comply with a mandate from the FDIC to lower their rates? They actually have some pretty neat products, including a no-penalty CD.
Ally Bank Is…
Ally Bank is from the old GMAC. They’ve rebranded given the obvious connotation with GM these days, even though they are really the old GMAC which wasn’t directly affiliated with GM any more, but I digress…as I’ve posted before, it’s great to buy CDs from distressed institutions since they’re still offering FDIC insured instruments, yet they are desperate enough that they offer above market average rates for savings and CD accounts.
No-Penalty CD
This is a pretty neat product I haven’t seen around much. And with the current rate being higher than just about any regular CD and with FDIC insurance to back it up, I figure this is a great option for anyone in the market for a CD these days.
As you can see below, the savings and money market accounts are among the highest in the nations as well.
*rates removed since not current; click through below for most recent
Since the rates may have changed since publication, visit the Ally Bank homepage to get a full listing of current rates.
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It is kind of amazing that GMAC is able to fund such a great rate using our tax dollars. I’m torn – is it a competition problem, or is it a good investment for the taxpayer?
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After setting up an acct with ally, I then initiated a fund transfer to ally (using ally’s online system). I called ally beforehand to make sure it would be ok since the 30 day time frame to deposit was approaching. I was ASSURED that as long as I initiated the transfer before 30 days, it was fine. I waited patiently for several days but received nothing from ally.. no e-mail, no phone call. I signed onto my ally acct. and now my balance showed a NEGATIVE dollar amount instead of zero. When I called them, they said my acct had been closed because I didn’t deposit money in time! BUT.. they had taken my money from my other bank! Incredulously though, they said at the same time that since the acct. was closed that they DIDN’T really have my money! My “old” bank confirmed the monies had been sent to ally. MORE calls to ally.. they have NO idea where my money is or how to get it back! I go into my “old” bank and they actually spend a LOT of time helping me figure it out although they had NOTHING to do with the problem. With the information (ACH tracking numbers that ally wouldn’t bother looking for) from my “old” bank, I call ally AGAIN ( I don’t even know how many times I called ally). This time (after mentioning perhaps banking authorities might be notified) they miraculously are able to find the money! I am STILL waiting for the money to be returned to my “old” bank. Funny.. their claim to fame.. being an ultra modern, high-speed, web-based bank.. sure seems like BS when you consider it has been over TWO WEEKS and I STILL don’t have my money back and they weren’t able to find, track, or identify ANYTHING! I had to go into an old-school, brick and mortar bank and have a REAL PERSON help me! So, an online bank may give you a little interest and allow you to use ATMs nationwide, but JUST WAIT until something goes wrong! THEN you will wish you had a REAL PERSON to help you! The winner here is oddly enough.. BANK OF AMERICA (my “old” bank)! haha! Caveat Emptor!
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