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#2061086 - 01/28/16 08:52 PM Discontinuing Bank Products
corporate audit Offline
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Joined: May 2008
Posts: 31
Are there any laws/regulations or guidance regarding discontinuing bank products and moving customers into other products that may not be as advantageous to them? Of course, a Change in Terms Notice is required. But is there any other guidance that would address this like there is for closing branches?

Thanks in advance.

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General Discussion
#2061142 - 01/29/16 01:45 AM Re: Discontinuing Bank Products corporate audit
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 78,584
Galveston, TX
Depends on the product and how much you want to [censored]-off those customers and possibly be accused of a UDAAP by the regulators.
There are a lot of issues to deal with that are not black and white in a regulation.
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#2061153 - 01/29/16 03:17 AM Re: Discontinuing Bank Products corporate audit
Richard Insley Offline
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Richard Insley
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Toano, VA
If "bank products" includes HELOCs, isn't it still the case that Regulation Z generally prohibits changes in terms?
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#2061156 - 01/29/16 12:23 PM Re: Discontinuing Bank Products corporate audit
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 78,584
Galveston, TX
Yes. That is why the first thing I mentioned was products, HELOCs, credit cards, etc. would present unique challenges. smile
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#2063177 - 02/08/16 10:24 PM Re: Discontinuing Bank Products corporate audit
corporate audit Offline
Junior Member
Joined: May 2008
Posts: 31
The products referred to are deposit products. Thanks for your comments.

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#2063426 - 02/10/16 10:31 AM Re: Discontinuing Bank Products corporate audit
Elwood P. Dowd Offline
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Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
There is no "how to" list or regulation focused on the issue. If your bank has a "products" committee, the task would be on their plate. The easiest points to focus on would be changes to those which you were required to disclose under Regulation DD, but you should think more broadly.

If you are thinking about changing terms on time deposits, that can only be done as they mature and in accordance with Regulation DD.
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#2067158 - 03/02/16 07:44 PM Re: Discontinuing Bank Products corporate audit
GenerousLife Offline
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Joined: Feb 2002
Posts: 1,466
USA
As part of product development, you should have an Exit plan in place prior to rolling out new products. Eventually, when the life cycle of that product/service expires, you will have guidance from your own research in the beginning, using those regs that apply to the product itself.

When you are able to think about this as you develop a product, it does sometimes change your product. No one likes to do this part, but it will pay off in the future.
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#2067245 - 03/03/16 02:06 AM Re: Discontinuing Bank Products corporate audit
Rocky P Online
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Joined: Jun 2003
Posts: 7,353
Florida
As part of product development, you should have an Exit plan in place prior to rolling out new products. Eventually, when the life cycle of that product/service expires, you will have guidance from your own research in the beginning, using those regs that apply to the product itself.

Take a look at OCC Bulletin 2004-20 Risk Management of New Expanded or Modified Bank Products and Services. It discusses how to evaluate, etc.
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