Proposal to offer 29,39,59 month CDs with better than average rate. Requires int payments by AFT to another account at our bank. After 1 year, will allow customer to close account WITHOUT PENALTY and change to a different term wtih stated rate IF FULL AMOUNT IS REINVESTED IN AT LEAST A 1YR CD. Can we do this? If yes, what additional disclosures and advertising requirements apply? Thanks in advance for your input - TJ .

As long as the CD is not closed within six days after the date of deposit(Reg. D required penalty period) - any early withdrawal penalty is purely contractual between the bank and the customer and could be waived at the bank's discretion.

As far as disclosures go, you'd want to be very clear in the requirements (if any) for waiving the penalty and follow Reg. DD for all other disclosures.