Jenny Ellis
BMO Bank, the Chicago based lender formerly known as BMO Harris, is offering certificate of deposit rates as high as 2.60% APY on a 13 month special CD, well below the top rates found at many online banks right now.
How BMO's CD Rates Stack Up
BMO splits its CD lineup into two buckets: standard CDs and special CDs. The standard terms run from one month all the way to five years, but most of those rates sit at rock bottom levels. Terms of one month through nine months earn just 0.05% APY, and even the longer standard terms, 12 months through 60 months, only pay 0.75% APY. Those numbers are based on ZIP code 10001 in New York City, and BMO says actual rates can shift depending on where you live.
The special CDs tell a different story. A 13 month term pays 2.60% APY, the best rate in BMO's entire lineup. Beyond that, a handful of longer special terms, 25 months, 35 months, 45 months and 59 months, all pay 2.00% APY. Minimum deposits are consistent across both standard and special CDs at $1,000, except for the shortest standard terms (one month and two months), which require $100,000 to open.
Standard CD Rates by Term
| CD Term | Minimum Deposit | APY |
|---|---|---|
| 1 month | $100,000 | 0.05% |
| 2 months | $100,000 | 0.05% |
| 3 months | $1,000 | 0.05% |
| 6 months | $1,000 | 0.05% |
| 9 months | $1,000 | 0.05% |
| 12 months | $1,000 | 0.75% |
| 18 months | $1,000 | 0.75% |
| 24 months | $1,000 | 0.75% |
| 30 months | $1,000 | 0.75% |
| 36 months | $1,000 | 0.75% |
| 48 months | $1,000 | 0.75% |
| 60 months | $1,000 | 0.75% |
Special CD Rates
| CD Term | Minimum Deposit | APY |
|---|---|---|
| 13 months | $1,000 | 2.60% |
| 25 months | $1,000 | 2.00% |
| 35 months | $1,000 | 2.00% |
| 45 months | $1,000 | 2.00% |
| 59 months | $1,000 | 2.00% |
Early Withdrawal Penalties and Fees
BMO doesn't charge a monthly maintenance fee on CD accounts, but pulling money out before maturity triggers a penalty that scales with the length of the term. For terms of one month (technically 7 to 59 days), you forfeit all interest earned. Terms of 2 to 11 months carry a penalty equal to 90 days of interest. Terms of 12 to 23 months cost 180 days of interest, terms of 24 to 35 months cost 270 days, terms of 36 to 47 months cost 365 days, and anything 48 months or longer carries a penalty of 545 days of interest, the steepest tier in BMO's schedule.
Interest compounds daily on every BMO CD. Once a CD reaches maturity, BMO automatically rolls it into a new CD of the same term unless the customer says otherwise. There's a 10 day grace period after maturity during which account holders can withdraw funds, add money, or close the account without facing a penalty.
Weighing the Trade-offs
The appeal of BMO's CDs comes down to that 2.60% top rate, which beats plenty of savings accounts and holds up reasonably well against competitors, even if it trails the strongest CD offers on the market. Term flexibility is another plus: savers can choose anything from one month to five years depending on when they'll need the cash.
The drawbacks are worth weighing too. A $1,000 minimum deposit is higher than what many online banks require, some of which allow CDs to be opened with no minimum at all. And the early withdrawal penalty, up to 545 days of interest, is steep enough that locking money into a longer term only makes sense if there's little chance of needing it early.
Who BMO Bank Is
BMO Bank, rebranded from BMO Harris, ranks as the eighth largest bank in North America by assets, with a history dating back to 1817 and an established footprint in both the United States and Canada. Its product shelf covers checking and savings accounts, retirement accounts, money market accounts, credit cards, mortgages and business financing. Opening a CD does not require an existing BMO Harris relationship, though current customers can sign into their online account to speed up the application. As with the rates above, terms can vary by ZIP code, so anyone comparing offers should check BMO's site for local pricing before committing. BMO is FDIC insured, meaning deposits are protected up to $250,000 per depositor.
Other Places to Park Savings
Savers who want to compare BMO against other options have several paths. High yield savings accounts at online banks sometimes beat what BMO offers on its CDs, without locking up the money. High yield checking accounts can also pay competitive rates, though they often come with balance requirements or debit card usage rules attached. Other banks' CDs may offer stronger rates or lower minimums than BMO's. Money market accounts offer another way to earn a return while keeping some liquidity. Treasury bills, notes and bonds are a further alternative: they're backed by the federal government, sometimes pay rates that rival or beat CDs, and in many cases can be sold before maturity with more ease than breaking a CD early.
Deciding Whether a BMO CD Fits Your Savings Plan
The 13 month special CD at 2.60% is the standout here, and it's the term most worth a closer look for anyone set on parking cash with BMO. But savers should weigh the $1,000 minimum, the automatic renewal feature, and those steep early withdrawal penalties against what's available elsewhere before locking in funds for more than a year.
