NEW YORK, Jan. 8, 2013 /PRNewswire/ -- RateWatch, a premier banking data and analytics service owned by TheStreet, Inc. (NASDAQ: TST) reported today that the average national rate on a 4-year and 5-year CD fell 0.01 percent based on data collected from over 90,000 financial institution locations. RateWatch also reported today the top rate issuers across the nation along with financial strength ratings.

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The main reason for bank deposit rates being so low for so long is the Federal Reserve's accommodative policy of keeping its target range for the short-term federal funds rate in a range of zero to 0.25% since late 2008; however, The Federal Deposit Insurance Corporation's Transaction Account Guarantee Program ended on Dec. 31, and that could put some pressure on smaller banks' liquidity.

The Transaction Account Guarantee Program went into effect in November 2008, to essentially remove any limit on FDIC deposit insurance coverage for most noninterest-bearing transaction accounts.  This provided a tremendous boost in cheap liquidity, even for banks in weak financial condition, because small businesses no longer had to worry about the safety of their checking account deposits, which could easily exceed the normal deposit insurance limits.  Now that the program has ended, businesses who were sticking with the banks because of the certainty of the deposit insurance protection may consider other cash management options, including non-bank money market funds.

With money market funds paying very low rates, it would be surprising to see quick movement out of bank checking accounts, however, some community banks that still have a high level of nonperforming loans could see some deposit flight, putting pressure on them to be more competitive in attracting non-checking deposits.

NATIONAL AVERAGE RESULTS - $10K

TOP RATE ISSUERS - $10K
This is a list of issuers with top interest rates.  The issuer's Financial Strength Rating is an independent, unbiased evaluation of quarterly regulatory statements. Institutions are assigned a letter grade of A-E with "A" representing the highest rating based on a review of many aspects of financial safety including capitalization, asset quality, profitability and liquidity. For more information, visit www.weissratings.com/help/what-our-ratings-mean.aspx.  Information is believed to be accurate, but not guaranteed.

Financial Strength Rating: A=Excellent, B=Good, C=Fair, D=Weak, E=Very Weak
Plus sign "+" = top of range, Minus sign "-" = bottom of range

Data is surveyed weekly with averages calculated each Monday afternoon from RateWatch's unbiased national interest rate survey of over 90,000 financial institution locations across the United States.

About RateWatch
For over 20 years, RateWatch has been the premier provider of competitive interest rate and product information to financial institutions across the United States.  Consistently providing top quality, highly relevant data RateWatch maintains the largest database in the industry with deposit, loan, and fee information monitoring over 90,000 locations. Rate surveys, product comparisons, financial strength reporting, local/regional/national averages, fee reporting, specialty reports and more are available.  To learn more about RateWatch, visit www.rate-watch.com.   RateWatch is a division of TheStreet, Inc.

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TheStreet, Inc.
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SOURCE TheStreet