Variable Rates CD

Variable Rates CD

If the Federal Funds Target rate rises, shouldn't your rate rise too? 


* Annual Percentage Yield (APY) is accurate as of 10/01/18.

These are available in a variety of maturities that earn variable rates of interest. Click here for our current rates.

  • $500 minimum deposit to open and earn the advertised APY
  • 2 year, 40 month, and 5 year terms available
  • Rates are variable and may change after account is opened
  • Automatic renewal at the prevailing rate
  • Penalty may be imposed for early withdrawal
  • Fees could reduce the earnings on the account
  • Cannot be combined with any other CD bump or offer
  • Online and Mobile Banking (inquiry only)
  • 24 Hr Telephone Banking


Understanding our Variable Rate CD

The interest rate on this account can increase and decrease based upon changes in the Federal Funds Target rate during the term of the CD. The interest rate will never go lower than the initial rate in effect when the account is opened.


What is the initial rate on the account?

Based on today’s federal funds target rate, which is the range 2.00%-2.25%, the index is 2.25%.


The initial rate for the account is based on the following calculations:

Product Rate Formula Rate Calculation Initial Rate on Account Lowest Rate During Term (Floor)
2 year CD Index  - 0.15% 2.25% - 0.15% 2.10% 2.10%
40 month CD Index + 0.85% 2.25% +0.85% 3.10% 3.10%
5 year CD Index +1.00% 2.25% +1.00% 3.25% 3.25%


What is the federal funds target rate?

The federal funds rate is the interest rate at which depository institutions lend balances at the Federal Reserve to other depository institutions overnight. The Federal Open Market Committee (FOMC) determines the federal funds target rate for this lending.


Who is the FOMC?

The FOMC consists of twelve members--the seven members of the Board of Governors of the Federal Reserve System; the president of the Federal Reserve Bank of New York; and four of the remaining eleven Reserve Bank presidents, who serve one-year terms on a rotating basis. The FOMC is responsible for open market operations. The FOMC holds eight regularly scheduled meetings per year. At these meetings, the Committee reviews economic and financial conditions, determines the appropriate stance of monetary policy, and assesses the risks to its long-run goals of price stability and sustainable economic growth.


When will the FOMC meet?

The FOMC is scheduled to meet eight (8) times per year to determine the federal funds target rate.


The remaining meetings for 2018 are September 25-26, 2018; November 7-8, 2018; and December 18-19, 2018.


The meetings for 2019 are scheduled for January 29-30, 2019; March 19-20, 2019; April 30-May 1, 2019; June 18-19, 2019; July 30-31, 2019; September 17-18, 2019; October 29-30, 2019; and December 10-11, 2019.


How will my interest rate change?

The bank will identify the federal funds target rate in effect on the last day of each month during the term of the account. The bank will update the index and on the first day of each month, the account will accrue at index plus/minus the appropriate margin for the remainder of the month. In no case, will the rate ever go below the initial rate on the account.