Ally Bank has made quite a reputation for itself. Using mostly Internet advertising, Utah-based Ally (which was formed from part of GMAC Financial Services) offers “straightforward banking,” according to the bank’s slogan. The idea is that, in the Information Age, people want easy to understand, fee-free bank accounts that combine online efficiency with no-nonsense terms. Ally has grabbed customers and gained marketshare by disposing with all the “banker babble,” like lengthy and indecipherable account agreements. People seem to like this.

Currently (that’s as of April 15, 2010), Ally is advertising just such a deal: the bank’s ‘No Penalty’ CD does what most banks never do, which is to allow a depositor to close the account early without cutting into the certificate’s principal. For an 11 month CD, the annual percentage yield is 1.35%; the account has no minimum to open, no minimum balance, no fees, and no penalty for early withdrawal, so long as you keep to certificate open for at least six days. As many banks do, Ally certificates of deposit accrue interest on a daily basis, for maximum earnings power (that’s time value of money at work, folks).

My former banker self wonders how, exactly, Ally can be making any money. I suspect that the bank is aiming for sheer volume of depositors, what with all the Internet advertising Ally is doing. Ally did recently add an interest checking account, but it, too, is fee-less–unlike other bank’s checking accounts, which tend to be fee-heavy as an important source of profits.

But who am I to question? I’m here on BankShout to help you save money with banking. That Ally Bank’s savings accounts and CDs will also save you time and effort just make their offerings that much more attractive. Overall, Ally is one of the bright new stars in the online banking firmament.