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CD Valet's CD Yield Curve Analysis: Insightful Findings on Competitive Rates

In a recent analysis, CD Valet, a key player in the digital financial marketplace, provided new insights into the yield curve of Certificates of Deposit (CDs). With a mission to connect consumers with the most tempting CD rates nationwide, the company highlighted discrepancies in CD pricing based on the asset size of financial institutions. This analysis is particularly vital for consumers seeking the highest yields on their savings.

As community financial institutions battle for consumer attention and deposits, CD Valet revealed that banks and credit unions with assets of under $500 million generally offer the most competitive rates. This segment has been proactive in providing attractive returns, especially for 12-month CDs.

Mary Grace Roske, Head of Marketing Communications for CD Valet, discussed the substantial differences observed in the analysis, stating, "Our research confirms smaller banks and credit unions often provide better rates to attract and reward customers. As asset size increases beyond certain thresholds, rate competitiveness generally diminishes, especially in institutions with assets exceeding $10 billion."

The data collected by CD Valet suggests that savers may find better yields away from the bigger names in banking. Specifically, for 12-month CDs, the median Annual Percentage Yield (APY) offered by institutions under $500 million stood at a robust 3.25%. In stark contrast, the median APY from institutions with assets exceeding $50 billion is just 2.03%. This variance represents a striking 122 basis point difference, which translates into a 60% higher yield at smaller institutions. This discrepancy underscores the growing importance of smaller banks in providing competitive rates for depositors.

The findings from CD Valet also shine a light on mid-sized institutions. Those with assets ranging from $500 million to $10 billion tend to maintain strong and consistent CD rates. Their offerings have fewer outliers with notably low APYs, which helps to elevate the overall APY curve. Additionally, the smaller gap between top and bottom rates within this asset range suggests a competitive environment that benefits consumers looking for reliable, well-priced deposit options.

On the other hand, larger institutions, particularly those over $50 billion, lag in rate competitiveness. Many of these institutions show a downward trend in median APYs across various CD terms. For instance, longer-term offerings of 36 to 60 months often yield APYs dipping below 1.20%. This trend indicates that substantial banks may prioritize their brand recognition and existing customer relationships over competitive rates as a strategy for attracting deposits.

As Roske noted, "While larger banks leverage their scale and brand to keep depositors, this approach does not always translate to better returns for savers. Many savers are missing out on higher yields by sticking with well-known banking names. Our analysis serves as a critical reminder for consumers to seek out better opportunities."

CD Valet stands at the forefront of helping consumers navigate the complex landscape of CD rates, currently tracking over 38,500 rates across nearly 5,000 financial institutions. The platform categorizes these institutions based on asset size, further enhancing consumer insight into where they can find the best returns.

In conclusion, CD Valet's CD yield curve analysis empowers both consumers and financial institutions. Consumers are encouraged to explore options beyond traditional big-name banks, while financial institutions can refine their pricing strategies using data-driven insights. With such valuable guidance, both sides can foster a more competitive and beneficial financial landscape.

For more information, visit www.cdvalet.com and check out their features that help consumers maximize their earnings on savings.