Yes, we believe a CD can be opened solely in the name of a minor child with their parents as authorized signers. The Illinois Banking Act specifically authorizes state banks to accept deposits made by minors and open accounts in their names, and a bank’s rules and regulations with respect to an account opened in the name of a minor is binding on them as if they were of full age and legal capacity.

Note that the Illinois Banking Act’s authorization to accept deposits from minors has not been tested in court with respect to deposit account features that could be considered credit-related, such as overdraft and offset or right of setoff provisions. To ensure that your bank can enforce overdraft and offset provisions for a minor’s deposit account, it may be advisable to ask the minor’s parents to join the CD as joint owners. However, in this case, the CD is unlikely to incorporate overdraft features, and offset provisions may be unnecessary.

For resources related to our guidance, please see:

• Illinois Banking Act, 205 ILCS 5/45.1 (“A state bank may accept deposits made by a minor and may open an account in the name of such minor and the rules and regulations of such bank with respect to each such deposit and account shall be as binding upon such minor as if such minor were of full age and legal capacity.”)