I’ve been taking a closer look at online banks and here’s one that I’d like to highlight: EverBank. If you’re looking for a place to park your short term savings — say for emergencies, for short term funds that you’ll need within the next 3 to 5 years or for savings that you’re accumulating for a bigger investment — then EverBank can provide you with a few good options.
Before we get into some of their flagship products and high yield savings accounts, let’s review what EverBank has accomplished over the last few years. They’ve actually snared several awards that attest to their top billing as an online bank. They’ve received the following awards:
- BauerFinancial Star Rating “4 Stars” in 2008
- Freddie Mac Tier 1 “Superior” Rating in 2008
- Money Magazine “Best of the Breed” in 2007
- Kiplinger’s “Best Checking Account” in 2006
- Forbes Best of the Web in the years 2000 – 2005
And this is just a sampling.
EverBank Savings Products
As for their savings products, EverBank offers several options. Their products are geared towards those who can maintain larger balances and who may have bigger bank accounts in general. They have both U.S. and foreign savings accounts that work together well if you’re seeking a diversified portfolio. Their foreign currency CDs are good options if you’re wanting exposure to international investments with possibly less risk and volatility. Here are some of their products:
1. EverBank FreeNet Checking Account: This high yield checking account offers a 3 month bonus rate of 2.25% for all new accounts. After 3 months, you’ll receive a new rate, resulting in a first year APY that varies based on your account balance. The first year APY ranges from 1.02% (for an account balance of $9,999 or less) to 1.46% (for a balance of $50,000 – $99,999). The minimum opening balance is $1,500 for the account, which has no monthly fees. You’ll also receive free online and mobile banking capabilities, a free Visa Check Card, unlimited check writing and optional online bill pay.
2. EverBank Yield Pledge Money Market Account: This money market account has a bonus rate of 2.25% which you’ll get for the first 3 months of owning the account. The first year APY (incorporating the bonus rate) is 1.51% for an account balance amounting to $50,000 or less. The minimum opening balance is $1,500. There is no monthly fee if you maintain a balance of at least $5,000; lower balances are charged $8.95 a month.
3. EverBank Yield Pledge CD: This certificate of deposit is available with terms ranging from 3 months to 5 years. The 3 month CD has a yield of 0.75%, the 1 year CD has a yield of 1.70% while the 5 year CD returns 3.39%. The minimum opening balance is $1,500.
4. EverBank WorldCurrency Access Deposit Account: This is a money market account that allows you to earn interest in a foreign currency. Money in this account can benefit from the appreciation of foreign currencies against the U.S. dollar, so this would be a diversification play (e.g. a way to hedge against the U.S. dollar). This account is liquid, with an initial deposit requirement of $2,500.
5. EverBank WorldCurrency Single CD: Ordinarily, we try to achieve investment portfolio diversification through foreign equities. But with foreign currency certificates of deposit, you can also get that kind of exposure. These foreign CDs are available in 3, 6, 9 and 12 month terms and carry no monthly fees. The minimum deposit is $10,000. You’ll make money by earning interest and by hedging against the U.S. dollar.
6. EverBank WorldCurrency Index CD: This type of foreign currency certificate of deposit is comprised of multiple foreign currencies from countries with specific economic characteristics. This would also make a great diversification play. The CDs are available in 3 and 6 month terms and have no monthly fees. The return you’ll receive is based on a fixed interest rate that tracks the index. The minimum deposit is $20,000, which is on the high side.
I like EverBank for several reasons: they’ve got a diversified set of financial products for savers and investors (they’re the only U.S. bank I know that offers foreign currency certificates of deposit, for example) and they offer highly competitive rates for their online savings accounts such as the Money Market Account and the FreeNet Checking Account.
EverBank is a well managed bank that found itself in an excellent position by sidestepping the subprime market crisis. This bank has emphasized quality investments, customers and products, and has avoided participation in the subprime market. Their strategies have paid off very well, as evidenced by their strong earnings gains:
EverBank recently reported positive earnings gains with a third quarter net income increase of 197% over last year’s third quarter numbers. Also, the growth this past quarter is around 37% compared to the previous quarter of this year. EverBank’s done particularly well in their mortgage banking business, showing strong mortgage asset portfolio returns.
EverBank continues to prove its financial strength by pursuing an acquisition program that involves acquiring smaller financial institutions and companies to help diversify its holdings. It has recently acquired a financial company called Tygris Commercial Finance Group Inc. as part of a diversification plan. As a retail bank, EverBank has sought exposure to commercial assets, which it has achieved through the Tygris deal.
So if you’re considering a bank that has an array of diverse, high quality products, a strong financial foundation and a solid reputation, EverBank is an outstanding choice.
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