Topic: Advertising & Marketing
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Can a credit union use the word “bank” in its advertisements? A credit union is advertising that “Your new ‘bank’ should be [Our Credit Union].” Can it use the word “bank” in this manner?
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While there is no definitive answer, we believe it is unlikely that Illinois law prohibits the credit union’s use of the word “bank” in its advertising. The Illinois Banking Act does prohibit any nonbank entity from using the words “bank,” “banker” or “banking” in connection with its business in a manner which would have a…
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We are one of two charters under the same holding company. We are printing statement stuffers advertising our overdraft services, which are identical. The envelope and periodic statements both include our bank’s name. We don’t want to pay to print up separate flyers for each charter, which would be identical but for the bank names. Can we print these without any bank name so that both banks can use the statement stuffers?
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Yes, we believe it is permissible to use statement stuffers that do not identify your bank’s name. We are not aware of any specific law or regulation that would require a bank to state its name in a statement stuffer when the bank’s identity can be inferred from other materials in the same mailing. However,…
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Can we advertise a savings account annual percentage yield (APY) at three decimal places? If no, and we advertise an APY rounded up to two decimal places, are we permitted to actually pay interest at the slightly lower unrounded rate?
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No, you may not advertise an APY at three decimal places. Regulation DD requires you to round the APY to two decimal places in advertisements and account disclosures. However, Regulation DD includes an exception to this general rule that will permit you to pay interest at the slightly lower rate shown in your account disclosures. …
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Our marketing brochure for the bank promotes our safe deposit boxes, among other services. The front of the brochure includes the “Member FDIC” disclosure. We were told that we should not include that disclosure when marketing nondeposit products. Should we remove the Member FDIC disclosure from the brochure?
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No. You are required to include the “Member FDIC” disclosure on the brochure. The FDIC requires you to use the Member FDIC disclosure when marketing both deposit and nondeposit products in an advertisement. In advertisements combining deposit and nondeposit products, you must “clearly segregate” the Member FDIC disclosure from information about the nondeposit products. In…
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Can a HELOC branch lobby banner or outside rolling digital sign contain the phrase “prime minus xx.xx%,” “prime floating,” or “x year term” without triggering the additional disclosures under Regulation Z?
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Yes, you should provide additional disclosures on advertisements using the terms “Prime Floating,” “Prime Minus xx.xx%,” or “X Year Term.” Unlike Regulation X, Regulation Z does not provide exceptions or permit short-form advertising disclosures for banners or scrolling digital signs. Regulation Z’s rules for home-equity plans require additional disclosures when an advertisement uses a trigger…
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Occasionally our bank will sponsor a non-profit’s fundraising event. The donation levels are printed in the event program with the bank’s logo, which includes the bankâs name. Is the event program considered to be advertising that would require the use of the “Member of FDIC” statement?
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Yes, it is likely that the event program would be considered to be advertising, triggering the requirement for the “Member of FDIC” statement. The FDIC Advertisement of Membership rules require the “Member of FDIC” or “Member FDIC” statement for certain types of advertisements. “Advertisement” is defined broadly as a commercial message that is designed to…
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We are putting together a statement insert advertisement announcing our new mobile banking app. Other than the Member FDIC and Equal Housing Opportunity notices, are we required to include anything else with the ad?
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We are not aware of any rules or guidelines that directly address your question. Having said that, if the app is characterized as a free service offered by the bank (or even is characterized as a free app on the website from which it is downloaded), we would advise disclosing that mobile carrier fees may…
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We are converting several branches from one bank to a second bank within our holding company. We have already mailed booklets explaining the change to affected customers, and the conversion will take place in about two weeks. Do you see any issues with a television commercial highlighting the branches as part of the second bank if it will start running before the conversion takes place?
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No, we do not believe that running the television commercial before the conversion takes place will create any issues, particularly because the affected customers already have received notification of the branch changes. We do recommend reviewing the Interagency Statement on Branch Names, which provides guidance for banks that are using one or more trade names…
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We are entering into a marketing agreement with a social media website, which will target advertising to our customers (based on a customer list that we will provide). The agreement requires the company to comply with all federal privacy laws. Is that sufficient for Illinois privacy law purposes? Any other possible concerns?
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Yes, that should be sufficient for Illinois privacy law purposes, provided that your agreement with the social media company complies with the federal law’s requirements in Regulation P. As explained in an Illinois Department of Financial and Professional Regulation (IDFPR) letter, the financial privacy requirements in the Illinois Banking Act incorporate all of the exceptions…