Truth-in-Savings Act

(redirected from Truth in Savings)

Truth-in-Savings Act

Legislation in the United States, passed in 1991, that requires banks to disclose interest (in APY terms), fees and other information when one seeks to open a savings account. It is enforced through Regulation DD.
References in periodicals archive ?
Part 230, its Regulation DD, which implements the Truth in Savings Act.
June 21 /PRNewswire/ -- The Truth in Savings Act enacted by Congress in 1991 as part of the Federal Deposit Insurance Corporation Improvement Act (FDICIA) goes into effect today.
Sharp Electronics Corporation announced today that the ZL-6500 Electronic Calculator can be programmed to calculate the new Truth In Savings Annual Percentage Yield (APY) formulas when computing IRAs, CDs, Money Markets and Savings Accounts.
I believe this approach is fully consistent with the purposes of the Truth in Savings and the Truth in Lending acts and reflects a sound public policy decision.
The Truth in Savings Act mandates that financial institutions disclose certain information about the terms of consumer deposit accounts in specific forms and at specific times.
To improve understanding of the process and costs of implementing regulatory changes, the Federal Reserve Board conducted the Survey of Compliance Costs for Truth in Savings in 1992-93, during the implementation period for the regulation.
Responses to the survey indicate that most banks provided extensive written disclosures to consumers before Truth in Savings but that most banks, if not all, had to change some policies and practices for consumer deposit accounts to comply with the law.
On March 19, the new Truth in Savings Law went into effect.
There is nothing in this truth in savings regulation that dictates to banks what interest they have to pay, or what method of compounding they have to use," Parker says.
We cannot make the case, for example, that Call Reports, examinations, basic prudential standards, reserve requirements, antitrust, truth in lending, truth in savings, and the like should not apply only to some banks if they apply to any.
I might also add that regardless of their societal benefits, one cannot help but be impressed with the frequency and intensity of complaints by banks of all sizes about the heavy burden of paperwork costs for the Community Reinvestment Act--and those that will be involved in impending requirements of the Truth in Savings Act.