We currently have 6 customers that are receiving special pricing on their savings accounts. We need a better way to handle the accounts and make sure rates are changing with the economy (it was discovered the rates hadn't changed in many years and we are paying quite a bit on them). It was decided in December that these rates will be tied to the fed funds rate. Our core system is being set up to add the new rate index that will be set to fed funds and then each customer will be tied to that, some could receive that rate, others may have a variance +/- of that rate, that is up to the VP of Retail and another Retail Officer to decide.

We have a “Special MM Savings Account” that currently 3 of these customers have. This account is not disclosed on the truth in savings, it’s identical to our money market account but their rate is determined by the bank and much higher than our standard rates. The thought is that we change the set up of this account and tie it to this new rate index and any customer in this product will then be tied to fed funds. As fed funds changes, their rate will automatically change.

The three remaining customers will need to move from our other money market products to this one. Will that require advance notice since the products are identical, just different rates? If they are identical products, do we need to create disclosures that their account is tied to fed funds? Currently money market disclosures states that the rate my change at the bank’s discretion.

Be kind and don't shoot the messenger please … I am new to this institution. I have an idea of what we need to do but as always, I need a little validation. Or the blinding light of idiocy shone down on me to burn out my wicked ways.

If the last account agreement that these people received states that the rate my change at the bank’s discretion, you just change the rates.