Region

Jurisdiction

Regulator

2012-03-22

Interest Calculation on an On-call (SRO) Deposit

The Supervisor of Banks issued this directive to standardize interest calculation procedures for on-call (SRO) deposits, mandating daily compound interest and explicit disclosure of the annual adjusted rate. Banking corporations must inform depositors of this rate upon account opening and allow them to select whether accrued interest compounds within the deposit or transfers to a current account. The regulation defines an on-call deposit as a non-indexed, interest-bearing account accessible for daily withdrawal, thereby establishing clear operational and disclosure standards for financial institutions.

Israel

Bank of Israel

Supervisor of Banks: Proper Conduct of Banking Business (8/98) Interest Calculation on an On-call (SRO) Deposit Page 440- 1 ONLY THE HEBREW VERSION IS BINDING INTEREST CALCULATION ON AN ON-CALL (SRO) DEPOSIT Introduction

The procedures of this regulation regulate certain matters regarding interest calculation on an on-call (SRO) deposit. Definitions
“On-call deposit” - A deposit which may be withdrawn daily, is not a current account, and whose terms are as follows: (a) The deposit bears interest; (b) The deposit is not indexed. “Annual adjusted interest” - As defined in Banking (Service to Customer) (Full Disclosure and Submission of Documents) Regulations, 5752–1992. Interest calculation on an on-call deposit
(a) The interest calculation on an on-call deposit shall be on the basis of daily compound interest; (b) A banking corporation shall disclose to a customer who deposits money in an on-call deposit the annual adjusted interest on the deposit; (c) A customer shall be entitled to choose whether interest will be accrued to the deposit amount or be credited to his current account at a time which is customary at the banking corporation or upon conclusion of the terms of the deposit, whichever is earlier, subject to the aforesaid in subsection (a).

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