Advertising

Checklist C: Advertising

Determine the types and extent of advertising within the control of the institution. Confirm that:
Advertisements are not misleading or inaccurate
"No cost" or "free" if any maintenance or activity charge may, in fact, be imposed
"Profit" in connection with interest paid

Only permissible rates are advertised (APY; simple interest rate, if used together and stated no more prominently than APY

Use the term "Annual percentage yield" at least once in the ad

For "tiered rate" accounts, that all APY's are stated, along with ranges and minimum balances where applicable

When the APY is stated, all triggered terms are set forth:
For variable rate accounts, a statement that the rate may change after opening
The time during which the APY is offered, or a statement that it's accurate as of a specified date
Any minimum required to obtain the advertised APY. For tiered accounts, each tier's minimum must be stated in close proximity to the corresponding APY
Any minimum opening deposit if greater than any minimum maintenance balance to obtain the stated APY
A statement that fees could reduce the account earnings

Additional time deposit items:
The term of the CD
A statement that a penalty may/will be imposed for early withdrawal

When a bonus is stated, triggered information is included:
The APY and all applicable triggered terms
Any time or balance requirement to obtain the bonus
Any required minimum balance to open if that amount is greater than the minimum needed to obtain the bonus
When (and how) the bonus will be provided

If abbreviated disclosures are used for prescribed exempted media, that the advertisement at least contains:
Any minimum balance needed to earn the stated APY
The term of any time deposits

If a bonus is stated:
The APY and corresponding minimum balance or time requirement
Any time needed to earn the bonus
Any minimum balance needed to earn the APY
For advertisements on internal lobby rate boards, a notice to contact an institution employee for further information

All APY's and interest rates are accurate to within 1/100 of one percentage point and carried to two decimal places

For an advertised stepped rate account, the institution has accurately disclosed the APY

Copyright © 1993 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 4, No. 4, 9/93