Over the past couple of months, HSBC Direct has been offering a promotional rate of 3.5% APY*. As of this week, however, they’ve dropped their rate to 3.25% APY*. That means that WaMu and FNBO Direct are at the top of the heap amongst the major online banks.
For their part, WaMu is offering an attractive 3.75% APY*. While has had their share of troubles, they’re FDIC insured, so there’s no real risk as long as you respect the FDIC insurance limits.
Alternatively, you might want to check out FNBO Direct (here’s a link to my FNBO Direct review). In fact, Bankrate considers FNBO Direct to be the safest online bank, edging out ING Direct for the honor.
*All rates are current as of 09/16/08, but may have changed since then.