Question:
Would the bank be violating Reg. O if it offered a higher Money Market rate for just shareholders? Answer: There is not a direct prohibition in Reg. O, since it primarily governs credit and not deposit accounts, like money market accounts. However, many banks have it in their internal policy to not give preferential interest rates to shareholders on deposit accounts either, to follow the spirit and intent of Reg O. Also, remember preferential treatment will oftentimes bring extra scrutiny. Comments are closed.
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