other than savings deposits, (1) in which the entire
beneficial interest is held by a party eligible to hold a
share draft account, (2) on which the reporting institution
has reserved the right to require at least seven days’
written notice prior to withdrawals or transfer of any
funds in the account, and (3) under the terms of which, or
by practice of the reporting institution, the depositor is
permitted or authorized to make withdrawals for pur-
poses of transferring funds to another account of the
depositor at the same institution (including a transaction
account) or for making payment to a third party by means
of a preauthorized transfer; a telephonic (including data
transmission) agreement, order, or instruction; or a check,
draft, debit card, or similar order made by the depositor
and payable to third parties.
A preauthorized transfer includes any arrangement by the
reporting institution to pay a third party from the account
of a depositor upon written or oral instruction (including
an order received through an automated clearing house,
or ACH), or any arrangement by the reporting institution
to pay a third party from the account of the depositor at a
predetermined time or on a fixed schedule.
Telephone and preauthorized transfers also include depos-
its or accounts maintained in connection with an arrange-
ment that permits the depositor to obtain credit directly or
indirectly through the drawing of a negotiable or nonne-
gotiable check, draft, order or instruction, or other similar
device (including telephone or electronic order or instruc-
tion) on the issuing institution that can be used for the
purpose of making payments or transfers to third persons
or others or to a deposit account of the depositor.
Also include in this item the balance of deposits or
accounts that otherwise meet the definition of time
deposits but from which payments may be made to third
parties by means of a debit card (including POS debits),
an ATM, an RSU, or other electronic device, regardless
of the number of payments made.
Teller’s check
A check or draft drawn by a depository institution on
another depository institution, a Federal Reserve Bank,
or a Federal Home Loan Bank or payable at or through a
depository institution, a Federal Reserve Bank, or a
Federal Home Loan Bank.
Teller’s checks do not include checks or drafts sold by a
bank acting in an agency capacity where that capacity is
clearly stated on the face of the check or checks, or drafts
drawn without recourse where permitted by state law.
Time certificate of deposit
A deposit described in section 1, subsection G.1, or a
primary obligation described in section 1, subsection
G.2, that is payable on a specified date, after a specified
period of time from the date of deposit, or after a
specified notice period, which may be not less than seven
days from the date of deposit.
A time deposit (including share certificates) may be
represented by a transferable or nontransferable, or a
negotiable or nonnegotiable, certificate, instrument, pass-
book, or statement. A nonnegotiable time deposit is
distinguished from a nontransferable time deposit in that
the transferee of a nonnegotiable time deposit would not
be a holder in due course and would not have the ability
to cut off certain defenses of an obligor even though an
exchange for value can be made. A nontransferable time
deposit allows no exchange for value to be made.
Time deposit
A deposit (including share certificates) described in
section 1, subsection G.1, or a primary obligation
described in section 1, subsection G.2, from which the
depositor does not have a right and is not permitted to
make withdrawals from within six days after the date of
deposit unless the deposit is subject to an early with-
drawal penalty of at least seven days’ simple interest on
amounts withdrawn within the first six days after deposit.
A time deposit from which partial early withdrawals are
permitted must impose additional early withdrawal pen-
alties of at least seven days’ simple interest on amounts
withdrawn within six days after each partial withdrawal.
If such additional early withdrawal penalties are not
imposed, the account ceases to be a time deposit. The
account may become a savings deposit if it meets the
requirements for a savings deposit; otherwise, it becomes
a demand deposit.
Time deposit open account
A deposit other than a time certificate of deposit, with
respect to which there is in force a written contract with
the depositor that neither the whole nor any part of such
deposit may be withdrawn prior to the date of maturity,
which shall be not less than seven days after the date of
deposit, or prior to the expiration of the period of notice,
Credit Unions
FR 2900
CU-49
Credit Unions April 2020