We allow a 10 day grace period to withdrawal funds after maturity on our automatically renewable certficates of deposit. Are we required to do so on time account 30 days or less. We have some customers that are actually using their 7 and 14 day CDs as savings, because our disclosure gives them the 10 day grace.

We have an early WD penalty for CDs with maturity periods between 7 and 31 days which states: "Forfeit at least the greater of a)all interest earned, or b)all interest that could have been earned during a period equal to 1/2 of the maturity period. A reduction from principal will be made when necessary to fulfill the penalty for early withdrawal."

So the customer will pay at least the interest from 1/2 the term. That keeps the early WDs down. AND we are VERY FIRM about exceptions to that policy for these short term CDs.

------------------
Randy at Washington Trust