America's Banks Are Reeling In Crisis, But Apple Savings Accounts Reportedly Draw In Nearly $1B In 4 Days

Apple, Inc.’s AAPL recently launched high-yielding savings account is a reportedly smashing hit already.

What Happened: Apple's savings account with a 4.15% annual percentage yield, has collected as much as $990 million in deposits over its first four days, Forbes reported, citing people familiar with the matter.

The company managed to amass nearly $400 million in deposits on the first day of the launch alone, the report said. Customers opened about 240,000 accounts during the launch week, it added.

Apple's massive iPhone user base and the attractive returns are the two pulling plants, drawing hoards of depositors, the report said.

The 4.15% return Apple offers on the savings account it floated along with Goldman Sachs Group, Inc. GS is more than the 3.90% return Goldman offers for its in-house high-yielding savings account under the Marcus consumer brand.

See Also: Everything You Need To Know About Apple Stock

Why It's Important: The strong deposit mobilization comes at a time well-established regional banking giants are seeing their deposits wiped out. Just Monday, San Francisco-based First Republic went under after its first-quarter earnings report showed a more than 35% tumble in deposits amid bank runs.

JPMorgan Chase & Co.‘s JPM deposit rates are around 0.01% and if the financial services giant were to pay a 4% rate on its $2.3 trillion in deposits, it may have to shell out $90 billion per year, a tweet by right-leaning blogsite Zerohedge showed.

There has been a flight of deposits to CD, money market funds and fintechs like Apple, said Richard Crone, CEO of payments firm Crone.

Commenting on Apple's move, Peter Mallouk, CEO of Creative Planning said recently "The brilliance of Apple has been about taking the complicated and making it look easy.” 

He sees Apple doing the same with its savings account. The account could be a much easier option for customers to invest their money in rather than Treasury bills, certificates of deposits, or money market funds.

“This is gonna be a grand slam, and a ton of people are gonna sign up for their card and it's gonna be another huge profit center for them,” he added.

In premarket trading, Apple shares edged up 0.01% to $169.61, according to Benzinga Pro data.

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