While some credit unions and banks in more than a dozen states are experiencing an increase in their average deposit rates, they may need to make some adjustments.
New data from research firm Market Rates Insight showed that despite an overall decrease in the national average deposit rate in the first four months of 2011, some states are showing an increase in the average deposit rate.
Although these states showed the highest increase, they do not necessarily offer the highest rates overall, the firm noted.
“Increasing deposit rates in some states is a good sign,” said Dan Geller, executive vice president at MRI in San Anselmo, Calif. “It may indicate that added liquidity is needed in those areas due to stronger demand for loans.”
From January to April, the rates of certificates of deposit increased by 18 basis points in Alaska. In Kentucky, the rates of money market accounts grew 17 basis points for the same period.
Of the states experiencing average deposit rate growth, New York had the highest increase with the rates on savings accounts rising by 23 basis points.
Checking account rates increased by two basis points each in Kansas, Alaska, Hawaii and Illinois. With CD rates, Rhode Island increased by eight basis points, Kentucky by seven basis points, Arizona by three basis points and South Dakota by two basis points.
The top MMA rate increases behind Kentucky were Delaware and Kansas at eight basis points, Alaska at five basis points and West Virginia at four basis points.
For the first four months of 2011, the rates of savings increased by one basis point each in South Carolina, Virginia, Alabama and Maine, Market Rates Insight said.