Parkway To Offer Higher Insured CD Accounts
by March 28, 2005 12:00 am 59 views
Parkway Bank of Rogers has begun offering a unique product for wealthy customers and municipalities. The bank can take certificates of deposit that will be federally insured up to $10 million — 100 times as much as most banks offer.
The Certificate of Deposit Account Registry Service (CDARS) allows depositors to earn CD-level interest rates in one account, rather than capping CDs at $100,000, the traditional Federal Deposit Insurance Corp. maximum insured.
“It’s really a small bank’s answer to gaining deposits,” said Bruce Branch, Parkway’s executive vice president.
Parkway can offer the service because it is a member of the CDARS network that exchanges deposits with other banks in increments of less than $100,000, so both principal and interest qualify for FDIC insurance.
Branch said that even though the deposits are spread across the network, the money remains local and helps fund the growth in Northwest Arkansas.
Other banks will eventually offer the same service Branch said, but he believes Parkway is the first in the area.