[📌 Update February, 2023: Bank of America continues to raise the rates on some of their Featured CDs (certificates of deposit) this month. Their 7 month CD and 13 month CD both had their yields lifted following the Fed’s 0.25% rate hike on February 1st. See more details below.]

Bank of America hardly needs any introduction. They’re the second largest bank in the United States by assets, with over $2.61 trillion in total and they are the third largest bank in the country by branch locations with roughly 4,559 across all 50 states.

That said, their savings rates – both fixed and variable – leave much to be desired and lag the current national average(s) for their respective terms by considerable margins.

This isn’t unique to Bank of America though, as most of the big banks are still offering low yields on deposit accounts.

That said, towards the end of the summer both Citibank and Chase Bank have started to entice consumers with slightly competitive yields on a small handful of CD accounts. These usually come in the form of Promotional CDs or CD Specials.

For those considering opening a fixed-rate, certificate of deposit with Bank of America continue reading our full review below.

Bank of America CD Rates + Account Details

Bank of America CDs are federally insured by the FDIC up to the applicable limits. These are $250,000 per depositor or $500,000 on joint accounts.

Bank of America has two sets of certificates of deposit available to consumers currently: “Featured CDs” and “Standard CDs.”

The Featured CDs come with a higher minimum deposit requirement of $10,000 compared to just $1,000 for the Standard CDs. Bank of America’s Featured CDs also offer five oddball terms to choose from. These are:

• 7 months
• 10 months
• 13 months
• 25 months
• 37 months

Featured CD Rates

Term	APY
7 months	3.25%
10 months	0.05%
13 months	3.90%
25 months	3.20%
37 months	0.05%

To put these yields in perspective the current national average for a 12 month CD and a 60 month CD sits at 1.28% APY and 1.21% APY, respectively, according to FDIC data.

That said, following the Fed’s first rate hike of 2023 and 8th consecutive rate hike since they began lifting prime rates midway through last year, some FDIC-insured online banks and nationally available credit unions are now paying 5.00% APY on short term CDs and ~4.50% APY on longer term CDs.

Bank of America’s Standard CDs have much more flexible terms ranging from 1 month to 10 years (120 months). Consumers may choose the exact number of months within that range. Current rates, however, are flat across the board for all terms.

Standard CD Rates

Term	APY
1 month (28 days)	0.03%
3 months	0.03%
6 months	0.03%
12 months	0.03%
2 years	0.03%
3 years	0.03%
4 years	0.03%
5 years	0.03%
6 years	0.03%
7 years	0.03%
8 years	0.03%
9 years	0.03%
10 years	0.03%

All of Bank of America’s standard, fixed-rate CDs have yet to rise with all terms paying the same APY.

There are two variables that normally affect the overall APY applied to your Bank of America CD. These are:

1. Your Location
2. Your Deposit Amount

While these variables do not change your rate at the moment, Bank of America still requires you to select these before disclosing the yields they offer on their website.

Your location is determined by the zip code you reside in and the deposit amount is broken up into four ranges for the Featured CDs and three ranges for Standard CDs. For Featured CDs, the deposit ranges are:

• Less than $10,000
• $10,000 to $100,000
• $100,000 – $1m
• $1m +

For all of Bank of America’s Standard CDs the deposit ranges are:

• Less than $10,000
• $10,000 to $100,000
• $100,000 +

Compounding and Crediting Interest

Interest is compounded and credited monthly on both featured and standard CDs.

Early Withdrawal Penalties

Bank of America’s early withdrawal penalties vary by length of the term of the deposit. Below is a breakdown of what you can expect to pay if you need to make an early withdrawal to your CD. You should note that for CDs with terms of 60 months (5 years) or greater, fees can potentially add up to more than the overall interest earned if withdrawals happen often enough.

CD Term	Penalty
90 days or less	7 days’ interest
90 days – 12 months	90 days’ interest
12 months – 60 months	180 day’s interest
60 months +	365 days’ interest

The interest penalties above are applied to the amount withdrawn.

Grace Period

The grace period is the brief window of time after your CD matures and before it gets renewed in which you have the ability to add or withdraw funds penalty free.

Bank of America’s grace period is slightly lower than the standard 10 days at just 7 days.

Bank of America’s CDs also automatically renew, so if nothing is done within this 7 day period your CD will automatically renew with the same terms and whatever the current APY happens to be at that time.

Bank of America will send you reminders leading up to the grace period of your deposit but be sure to set up your own notifications as well.

Final Thoughts

While banking with large institutions such as Bank of America has its advantages such as easy in-person branch access, vast network of ATMs, and a wide range of financial products, their Featured CD rates aren’t as competitive as other offers from online banks at this time.

Most online banks and credit unions have begun to lift their CD and savings rates in a major way as the Fed continues to raise prime rates. However, larger banks like Bank of America, have been slower to provide generous yields to savers but are finally starting to lift some of their rates on select terms.

Why are Bank of America’s CD Rates so Low?

Although many of their Featured CDs are seeing their rates increase regularly, most of Bank of America’s CD rates remain much lower than the yields offered by online banks and some credit unions.

Why is this?

In rising interest rate environments, banks tend to see larger profit margins as the difference between the interest rates they pay out on savings and the loan rates they charge borrowers grows. This is known as the “net interest spread” and it’s why larger banks in particular are more reluctant to increase rates on CDs and savings accounts.