Article 11. Interest of California Financial Code >> Division 2. >> Chapter 5. >> Article 11.
An association may issue savings accounts earning interest at
different rates of return. The annual rate of return paid on a
savings account may either be fixed at the time the account is issued
or may vary on any basis specified at the time the account is
An association may classify its savings accounts on any basis
including, but not limited to, character, amount, or duration of the
account, regularity of additions, or location of origin of the
Except for accounts that are classified according to a
specified contractual time or notice period, interest shall be based
on the withdrawal value of each savings account at the beginning of
the accounting period, plus additions made during the period (less
amounts previously withdrawn and noticed for withdrawal, which for
interest purposes shall be deducted from the latest previous
additions) computed at the rate for the time the funds have been
invested, determined as provided in Section 7053.
(a) The date of investment in a savings account shall be the
date of actual receipt by the association of the account or an
addition to the account, except that if the association shall so
determine, accounts in one or more classifications or additions
received by the association on or before a date not later than the
20th day of the month (unless the day determined is not a business
day, in which case it may be the next succeeding business day) shall
receive interest as if invested on the first day of the month in
which the payments were received.
(b) If the association makes a determination under subdivision (a)
it also shall determine that payments received subsequent to that
determination date shall either receive interest as if invested on
the first day of the next succeeding month, or receive interest from
the date of actual receipt by the association, except as provided by
The board of directors, by resolution, may determine any of
(a) That interest shall not be paid on designated types of savings
accounts from which withdrawals may be made upon demand or by
negotiable and transferable order or authorization.
(b) That an association may establish minimum balance requirements
for savings accounts to be eligible for distribution of interest.
(c) That, subject to applicable maximum regulatory limitations, an
association may pay interest on a savings account at a rate or
anticipated rate of return determined at the time that the account is
The directors shall determine the method of calculating the
amount of any interest on any savings account classification as
provided in this article and the time or times when the interest is
to be paid or credited.