N.Y. Comp. Codes R. & Regs. tit. 3 § 13.2

Current through Register Vol. 46, No. 51, December 18, 2024

Section 13.2 - Distribution of disclosure brochures

(a) Each banking organization shall provide to any potential depositor upon request, and to any depositor at the time of the first deposit of funds into a savings or time deposit account, the information required by this Part. In the case of an account opened by mail, such information shall be provided, by mail or in person, when the depositor receives acknowledgment of the opening of the account.

(b) In order to notify existing depositors of the availability of the disclosure information required by this Part, each banking organization shall either:

(1) prominently post a notice in the lobby of each office of the banking organization located in the State of New York (other than electronic branches);

(2) periodically prominently include a notice in existing advertising or in separate advertising; or

(3) mail a notice to each depositor.

(c)

(1) In all future advertising which solicits savings or time deposit accounts, each banking organization shall include a prominently placed notice which shall state that further information about the account may be obtained at any branch of the banking organization or by calling a specified person or department of the banking organization.

(2) Paragraph (1) of this subdivision shall not apply to radio advertisements.

(d)

(1) Not more than 10 business days after a banking organization adopts any change in the following, which is less favorable to the depositor:

(i) annual interest rate;

(ii) annual percentage yield;

(iii) periodic percentage rate;

(iv) compounding period;

(v) the frequency of crediting interest;

(vi) grace periods mandated by any regulatory authority; or

(vii) minimum balance requirements mandated by any regulatory authority;

the banking organization shall notify in writing each depositor affected by such change.

(2) Not less than 30 days before a banking organization adopts any change (unless such change is mandated by any regulatory authority) in the grace periods or minimum balance requirements of a savings account, which is less favorable to a depositor, the banking organization shall notify in writing each depositor affected by such change. As to such existing accounts, no such change in the minimum balance requirements or grace periods shall become effective prior to the commencement of an interest or dividend period.

(3) When notice of maturity for a time account is sent to the depositor, the banking organization shall include a statement of any changes in the annual interest rate, annual percentage yield, periodic percentage rate, the compounding period and frequency of crediting interest on a new time deposit having substantially the same terms.

(4) The provisions of paragraphs (1) through (3) of this subdivision do not apply to a savings or time account which is offered at a rate which varies in accordance with market interest rates as long as the underlying formula is not changed by the banking organization (e.g., "money market certificates").

(5) Not less than 30 days before a banking organization elects to convert a passbook or statement savings account paying a fixed annual rate of interest to a savings account paying a variable rate of interest, the banking organization shall notify in writing each depositor affected by such change. The notice shall clearly describe the change including the banking organization's method of fixing the rate thereafter. The banking organization shall also prominently display a notice describing the change in the lobby of each branch for the 30- day period prior to the change and shall keep such notice posted for a minimum of three months after the change becomes effective. As to existing savings accounts, no such change shall become effective prior to the commencement of an interest period. In the event the savings account is a statement savings account, then the banking organization shall also comply with the notification provisions of section 13.7(d) of this Part.

(e) Written notice of the date on which a time deposit with a term of one year or longer will mature shall be furnished to each depositor not less than 14 and not more than 30 days prior to the expiration of the term of the time deposit.

N.Y. Comp. Codes R. & Regs. Tit. 3 § 13.2