Risks When Offering A Corporate Savings Account
Answer by: John Burnett, BOL Guru
BIO AND CONTACT INFO
Question: Can a bank offer a corporate savings account? Anything I need to look out for.
Answer: Yes, you may offer savings accounts to corporations. Make sure you have appropriate signature cards and board resolutions authorizing the opening of the account and naming the person(s) authorized to do so.
These accounts are subject to the same Regulation D transaction limitations as personal accounts, as well as the requirement to reserve the right to require up to 7 days' advance notice of withdrawal.
Suggestion -- You might want to either structure your fees on such an account to include the same per item deposit fees as you apply to deposit accounts for businesses, or include in your deposit contract a prohibition against the business depositing daily receipts into the account to clear checks. We've found that some penurious business owners have tried to avoid deposit activity or account analysis fees by dumping their check deposits into a savings account before moving the funds into checking.
[Editors Note: As of 7/2/09, the separate limit of three per month for checks, POS debit card transactions, etc., has been eliminated, and those transactions are now only subject to the 6/month limit that applies to other restricted transfers and withdrawals.]
First published on BankersOnline.com 8/05/02
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