Beal Bank, founded in 1988, is actually a collection of companies. For our purposes, we’ll be focusing on two of them: Beal Bank and Beal Bank USA. Beal Bank is headquartered in Dallas, Texas and has 16 physical locations across 10 states. Beal Bank USA is headquartered in Las Vegas, Nevada and has 21 physical branches across 19 states and the District of Columbia.
Together, the two banks offer a wide variety of certificates of deposit (CDs) with competitive interest rates and terms ranging from three months to five years. For all CDs, both banks require a minimum deposit of $1,000. Online applications are available for the CDs, or you could do your banking in person if you live near one of the 37 branch locations.
Beal Bank CD
Beal Bank has locations in Alabama, California, Florida, Illinois, Maryland, Missouri, New York, Ohio, Pennsylvania and Texas. Terms range from three months to five years, allowing ample opportunity for CD laddering. The strategy hinges on parking your money in CDs of different term lengths so you can stagger how quickly you'll have access to your funds and get more robust growth on long-term CDs.
|Account Period||Minimum Amount||APY|
|3 Month||$1,000||1.75%||Compare CD Rates|
|6 Month||$1,000||1.85%||Compare CD Rates|
|9 Month||$1,000||1.95%||Compare CD Rates|
|12 Month||$1,000||2.35%||Compare CD Rates|
|18 Month||$1,000||2.35%||Compare CD Rates|
|24 Month||$1,000||2.35%||Compare CD Rates|
|30 Month||$1,000||2.35%||Compare CD Rates|
|36 Month||$1,000||2.35%||Compare CD Rates|
|48 Month||$1,000||2.35%||Compare CD Rates|
|60 Month||$1,000||2.35%||Compare CD Rates|
Beal Bank USA CD
Beal Bank USA has locations in Arizona, California, Colorado, Maryland, Virginia, Florida, Georgia, Illinois, Kansas, Massachusetts, Michigan, Minnesota, New Jersey, Nevada, New York, Oregon, Pennsylvania and Washington. The terms available are identical to those of Beal Bank, but interest rates are slightly higher for each term.
|Account Period||Minimum Amount||APY|
|3 Month||$1,000||1.90%||Compare CD Rates|
|6 Month||$1,000||2.01%||Compare CD Rates|
|9 Month||$1,000||2.11%||Compare CD Rates|
|12 Month||$1,000||2.61%||Compare CD Rates|
|18 Month||$1,000||2.61%||Compare CD Rates|
|24 Month||$1,000||2.61%||Compare CD Rates|
|30 Month||$1,000||2.61%||Compare CD Rates|
|36 Month||$1,000||2.61%||Compare CD Rates|
|48 Month||$1,000||2.61%||Compare CD Rates|
|60 Month||$1,000||2.61%||Compare CD Rates|
12-Month CD Interest Rate Comparison
Overview of Beal Bank and Beal Bank USA CDs
Although the two banks share a lot in common, they are distinct entities. Beal Bank has its headquarters in Dallas, and Beal Bank USA has its headquarters in Las Vegas. This can actually work in your favor, though. Since the banks are distinct, you have the option of investing in both and effectively doubling your FDIC protection. Interest for all CDs in both banks is compounded quarterly. Once it’s been compounded, you are free to withdraw interest that you’ve earned, although doing so will lessen your maximum earning potential.
Unlike with interest, you’ll incur a penalty if you withdraw any of your principal investment before your maturity date. If your CD’s term is for 12 months or fewer, your penalty will be the greater of 1% of the amount you withdraw or one half of the interest you would have earned on the amount you withdraw across the entire term of the CD. So let’s say you invested $5,000 in a six-month CD at Beal Bank USA. If you wanted to withdraw $1,000 before six months had gone by, your penalty would be the greater of 1% of $1,000 ($10) or half the interest of $1,000 in a six-month CD ($4.76). You would pay a penalty of $10.
If the original term of your CD is more than 12 months, your penalty is calculated a bit differently. You’ll pay the greater of 1% of the amount you withdraw or the amount the bank refers to as the Replacement Cost. The replacement cost represents the interest cost to the bank of replacing the funds you’ve taken. The bank calculates this cost by imagining funds in a CD that has a term roughly equaling the time you have left on the term of your CD. The amount you withdraw is multiplied by the remaining term on your CD, and that result is then multiplied by a replacement rate.
The replacement rate has its own calculation process, and it’s fairly complex. The bank first finds a U.S. Treasury instrument available for purchase on the date you withdraw your funds and maturing on the maturity date of your CD. If there’s no product available with those exact dates, then the bank will imagine a hypothetical instrument by interpolating actual instruments with maturity dates right before and right after yours. Once the bank has that, it will calculate the replacement rate by taking the yield of the chosen Treasury instrument, adding a risk premium of 0.50%, then subtracting the interest rate of your CD.
So let’s say you bought a $10,000, 60-month CD (with an APY of 2.35%) from Beal Bank and you want to withdraw $4,000 after 36 months. Let’s also say there’s a U.S. Treasury instrument with a yield of 3% available for purchase that matures on your CD’s maturity date. Your penalty would be the greater of a) 1% of $4,000, which is $40, or b) $4,000 x 2 years x (3% + 0.5% - 2.35%), which is $92.00. Your penalty would be $92.00.
To avoid all this calculation, it’s best to refrain from making early withdrawals from your principal if you can. Once your CD matures, you will have 10 days to act, otherwise the bank will renew you for another CD of the same term.
Compare Beal Bank to Other Competitive Offers
How Much You Earn With Beal Bank Certificate of Deposits Over Time
The competitive interest rates at both Beal Bank and Beal Bank USA allow for your investments to grow significantly. Interest is compounded quarterly for all Beal Bank and Beal Bank USA CDs, which sets it apart from many other CDs with competitive rates that compound daily. Another unique feature of these CDs is that the rate remains the same for all terms 12 months or longer. This reduces the incentive to purchase a term longer than 12 months since you can just let the account auto-renew if you wish to leave your funds for a longer period of time, but you can withdraw them if you choose to.
Note that these calculations assume no interest is withdrawn before the maturity date.
|Initial Deposit||3 Month CD||12 Month CD||60 Month CD||USA 3 Month CD||USA 12 Month CD||USA 60 Month CD|
How Beal Bank CD Rates Compare to Other Banks
Rates for Beal Bank CDs are more competitive than traditional brick-and-mortar banks, although the $1,000 minimum deposit can can be a high initial hurdle to clear for some potential investors. The rates for short-term CDs are even competitive with those of online banks like Ally and Marcus by Goldman Sachs. However, the stagnation of rates after 12 months causes Beal Bank to fall behind once the terms are longer.
Note that the rates listed for Chase are assuming you make $1,000 deposit and are not connecting your CD to a Chase checking account.
|CD Account||Beal Bank||Beal Bank USA||Ally||Chase|
Should You Get a Beal Bank CD Account?
If you aren’t deterred by the $1,000 minimum deposit requirement, then you might want to consider a CD from Beal Bank, especially if you’re looking at CDs with term lengths of less than a year. If you live in a city that has a Beal Bank or Beal Bank USA branch location, that could serve as another incentivizing factor.
If you’re looking to invest in a long-term CD and you’re comfortable with online banking, then you'll find the best CD rates with an online bank like Ally. If you live in a less populated area and in-person banking is important to you, then Beal Bank might not be the best choice for you.