03/02/2015
We are looking to change (strengthen) the penalties on CD maturities - what type or time frame of notice do we have to provide for those changes going forward?
04/22/2013
Our CD (Bankers System copyright) has the language: <i>We may change any term of this agreement. Rules governing changes in interest rates have been provided. For other changes we will give you reasonable notice in writing or by any other method permitted by law. If any notice is necessary, you all agree that the notice will be sufficient if we mail it to the address listed on page one of this form. You must notify us of any change.</i> Does this allow us to change our early withdrawal penalty by a mass mailing to all of our CD customers with a 30-day notice of the change? Also, do we need to be specific by account or can we just provide a chart that shows all of the new penalties?
02/11/2013
A spouse dies on a jointly owned CD. Can the name of the deceased be removed and the CD continued to maturity? OR do you let it mature and then change the ownership? Is there a penalty for changing only the name due to the death?
09/17/2012
Is there a regulation regarding waiving the penalty for a customer for a early withdrawal from a certificate of deposit?
08/13/2012
I've been asked to research what compliance issues there might be with changing our CD early withdrawal penalties from interest based (e.g., 3 months interest) to principal based (e.g., penaltiy is 1% of principal amount at opening or renewal).In what I've been able to find, the only thing I see relates to the Reg D requirements for the penalty to be at least 7 days simple interest if the withdrawal occurs within the first six days to be considered a time deposit. Assuming we can cross that hurdle, are there other compliance issues that I'm missing? UDAAP potential comes to mind, but if we are clear and transparent in disclosing the penalty are there other aspects of UDAAP that could bite us? We are looking at this as a defensive/customer retention tactic. With today's rates so low, and as a result with interest-based early w/d penalties also low, customers have no real downside to locking in higher yields today by putting into long term CDs with the thought that if rates jump significantly in a year, the penalty will be more than offset by moving to a higher yield CD early.I'd be interested in hearing any thoughts. We have heard anecdotally that other banks may be considering or already doing this. Is anyone aware of a bank doing this at this time?
06/11/2012
Our FI is considering increasing the withdrawal penalties for CDs and we understand that we are required to notify customers of the increase. Most information states to notify them at approaching renewal (20 days before end of grace period). Instead of then, am I able to send a mass mailing to all CD holders now instead of waiting until each CD is about to renewal?
06/11/2012
I know there are certain instances in which we can exempt an account from the early withdrawal penalties as required by regulation. 1. Can we waive the early withdrawal penalty of a CD that was opened from the proceeds of a loan exclusively to pay taxes on the property securing that loan? 2. Can we waive the penalty of a CD opened by an employee of ours if that employee wants to apply those funds as a partial payment to a loan he has with our financial institution?
09/05/2011
What are the requirements for notifying customers of an increase in our early withdrawal penalties for CD's? What is the best way to do this?
02/28/2011
Please help me give a good explanation to customers for the federal law that stipulates the early withdrawal penalty of at least 7 days interest on amounts withdrawn within the first six days after CD deposit.
08/31/2009
A customer dies and the executor of estate changes certificate of deposit to a CD titled: The Estate of Deceased Customer, then wants to cash in the CD before maturity. Can we charge an early withdrawal penalty? I know if the CD had still been in deceased's name and social we would not charge a penalty.