I have a strange request from a customer (I'm still trying to get info on why / how the customer made this decision - not very savvy).

Customer has a CD with us. Quarterly we credit their DDA account for the interest. Customer closed the DDA and has asked the bank to just compound the interest annually and at the end when the CD comes due. We did offer to send them a check quarterly and they did not want payments in a check form. I'm thinking there may have been a discussion with the bank and we did not want to compound quarterly so we compromised on compounding annually or mailing a check but I'm not 100% certain this is how the conversation went.

At one point in time we did research being able to ACH interest payments to accounts outside our bank but elected not to becuase of add'l disclosure requirements (I forget all of the specifics on why it was too much work). So this is not an option.

If in the end, this is really what the customer wants, I need verification of the following:

1) it is a change in terms that I believe requires a new TISA disclosure, correct? Changing the terms from interest "paid" quarterly and at maturity to interest "compounded" annually and at maturity?

2) Do we have to provide a 30 day advance notice since it is an adverse change? Or is the 30 days a moot point since it is a customer requested change - I think we wait the 30 days because the Reg appears to be silent on this.

3) any other ideas, concerns I should be aware of?