Free Mercedes with that bank account

This post comes from Kelli B. Grant at partner site SmartMoney.

Consumers in the market for a new bank account have gotten used to three-figure bonuses. Now, one bank is dangling a $60,000 car -- if you have a spare $1 million to stash away.

A new offer from C1 Bank, a Florida community bank with assets of $827 million, promises new customers their choice of one of four new Mercedeses in exchange for depositing $1 million in a five-year certificate of deposit. "We've had lots of questions about it," says chief executive Trevor Burgess. "Nobody has taken us up on it yet, but we're only on Day Two."

It's not all that unusual for banks to offer big-ticket freebies in exchange for a hefty deposit. As we reported last year, Chase offered New York City customers who deposited $100,000 a bonus of two free front-row tickets for a sports match, musical or concert. That was worth as much as $1,000, the equivalent of a 2% rate. (Post continues below.)

"Typically, these kinds of schemes are about competition, getting customers and cash," says Dennis Moroney, a director of research at consulting firm Tower Group. He says the publicity value is likely higher than any real need for big-ticket deposits. "People who have a $1 million to put away for five years . . . probably already have a Mercedes or two," he says. (How much vehicle can you afford? Try MSN Money's calculator.)

But the C1 offer has one big catch. It's not actually a bonus, but rather prepaid interest on the 1.2% account, Burgess says. Consumers get what amounts to a $61,294.04 car (including tax, delivery and registration) instead of five years of interest, worth $60,000, reports Business Insider. "It's about instant gratification," says Burgess. Accountholders who withdraw funds early will get the balance less the cost of the car.

• Smart Spending on the go: Get our app for Android or iPhone

Of course, if you're in favor of deferred gratification, there may be more competitive rates. Bankrate.com lists 18 financial institutions offering higher rates on a five-year jumbo CD, with annual percentage yields of up to 1.8%. Five years is also a long time to lock in -- although the Fed has said rates are likely to stay low until at least the end of 2014, they will certainly go higher than they are now, Moroney says.

At the same time, the car's value will be depreciating. (Burgess says the rate is competitive, and has the advantage of keeping the money in the community to benefit local businesses and residents.)

More on SmartMoney and MSN Money:

• 7 tips for landing cheap airfare
• Complaining on Twitter may cost you
• Money lies that spouses tell
• Today's best savings rates
• The most and least expensive cars to insure
• How to avoid new checking account fees