Bank of Montreal has introduced a new high-rate savings account that pays 4% interest.

The Premium Rate Savings Account offers all the features of a regular savings account. Customers must maintain a minimum monthly balance of $5,000 in the account to earn the premium rate. The full rate of interest is earned on the entire balance when the balance exceeds $5,000.

“This is a high-rate account that is ideal for customers who are trying to save for a major purchase, park their funds between transactions, shelter cash balances during periods of stock market volatility or diversify their investment portfolios,” said Wendy Millar, senior vice president, Everyday Banking.

“Considering that today’s prime rate is 6.25%, a savings account that pays four per cent and gives the customer immediate access to funds is a great value and premium,” said Millar.