After many years of miniscule returns, banks are finally giving savers a decent return on their money. And even if the rates at your bank haven’t bumped higher yet, that might change soon.
The failures of two banks — Silicon Valley Bank and Signature Bank — caused many customers at small and midsize banks to pull their money out and put it into larger banks perceived as safer.
To keep their remaining customers in the fold, smaller banks likely will be forced to raise rates on savings accounts, according to a Wall Street Journal report.
The newspaper says some banks already are raising rates on savings accounts. According to the WSJ:
“Los Angeles-based PacWest Bancorp, a lender with a lot of startup customers, had offered as much as 5.5% for a shorter-term CD in recent weeks. A CD offered by Merchants Bank of Indiana has an introductory yield of about 5.4% that can move higher if the Federal Reserve’s benchmark rate does.”
The average rate on deposits at banks and credits unions was 0.37% in March, up from 0.06% one year earlier, the WSJ reports. However, rates for online savings accounts were much higher, averaging about 3.75%.
Now, even the larger banks are beginning to raise their rates, according to the WSJ. The newspaper says Citigroup, JPMorgan Chase and Wells Fargo have all substantially hiked rates on their interest-bearing accounts.
Of course, you don’t have to wait around for your bank to raise its rates when plenty of other banks already have done so. Stop by Money Talks News’ Solutions Center and search for a great savings account rate today.