Fine print takes air out of alluring pitch for funds

Does 5 percent on a bank passbook savings account sound good in these days of declining interest rates?

Well, better hurry...or wait.

While a bold-face 5.00 percent (1½ inches high) stands out in current print ads of First Republic Bank, a tiny asterisk --- the size of an ant --- appears at the upper right of the percentage sign.  Following that down to the bottom of the ad in almost unreadable small white print against a black border background shows:

“ * $150,000 minimum balance required to obtain the stated APY of 5.00% for a Passbook Savings Account.”  Opening an account with less funds, with a minimum of $5,000, pays lower rates.

Grumpy Editor notes two cautions face potential patrons.  The Federal Deposit Insurance Corp. (FDIC) insures accounts to $100,000.  Thus, depositing $150,000 goes over the FDIC insured limit.  Then small type also mentions, “on the $150,000+ balances, rates are not subject to decrease until January 8, 2008.”

For that “Guaranteed Until 2008” rate line in the ad, that’s just 11 weeks away.

First Republic Bank, headquartered in San Francisco and with offices mostly on the West Coast plus New York, Connecticut and Massachusetts, was acquired a month ago by Merrill Lynch and operates within the Merrill Lynch Global Bank Group as a division of Merrill Lynch Bank & Trust Co., FSB.