I am updating our deposit account disclosure and want to remove this section.

Notice of withdrawal
We reserve the right to require not less than 7 days notice in writing before each withdrawal from an interest-bearing account other than a Certificate of Deposit or demand deposit, or from any savings account as defined by Regulation D (the law directs us to reserve this right. but it is not our policy to use it)

Does anyone use this language and require 7 days notice and why? I thought it had something to do with Reg. D. My boss thinks it goes back to the recessions so the bank can stop people from taking out their money and have a volume of cash leaving the bank.

Thanks!

If you eliminate that, then every account you have in the bank will become a transaction account. You will no longer have any savings account or time deposits.

204.2(d)(1) Savings deposit means a deposit or account with respect to which the depositor is not required by the deposit contract but may at any time be required by the depository institution to give written notice of an intended withdrawal not less than seven days before withdrawal is made, and that is not payable on a specified date or at the expiration of a specified time after the date of deposit. The term savings deposit includes a regular share account at a credit union and a regular account at a savings and loan association.

The notice of withdrawal clause/disclosure is required for NOW, ATS and Savings accounts as this 7 day requirement is what classifies them as this type of account under Regulation D (see 204.2).

Which products, specifically, are you planning to remove this disclosure from?

If you are removing this from your savings accounts, you can, but they will no longer be savings deposits. This means two things. First, your controller must no longer report them as savings accounts on your Call Report/UBPR. Secondly, these accounts will now be subject to the hold requirements of Regulation CC.

Thanks for the information:

I was specifically going to remove Savings Accounts because of the Reg. D update eliminating transaction limitations. I realize that they will be subject to Reg. CC if they are but we might want to be issue Debit Cards on Savings (as their primary account)
I don't know about the Call Report and thanks for pointing that out.
I think I am over thinking this whole subject and should just leave the 7 day notice in the disclosure and keep savings accounts as savings accounts.