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Deutsche Bank Insured Program FAQs
FAQS ABOUT THE DEUTSCHE BANK INSURED DEPOSIT PROGRAM
The following Frequently Asked Questions are provided to keep you informed of new developments regarding our Deutsche Bank Insured Deposit Program for accounts held at Pershing, LLC. For complete
information about our Deutsche Bank Insured Deposit Program, please review the Terms & Conditions
What is the Deutsche Bank Insured Deposit Program?
The Deutsche Bank Insured Deposit Program is a core account investment vehicle used to hold cash balances awaiting reinvestment. The cash balance in a Brokerage Account is automatically deposited or “swept” into an interest-bearing account at one or more banks participating in the Program. The Program is designed to provide up to $2.5 million maximum applicable FDIC deposit insurance per account.
What accounts are eligible for the Program?
All accounts except fee-based retirement accounts are eligible for the Program. Corporate accounts are also eligible for the Deutsche Bank Insured Deposit Program.
How are fee-based retirement accounts addressed?
Fee-based retirement accounts utilize Dreyfus Government Cash Management money market fund as the core account investment vehicle. This is an institutional money market fund that meets ERISA requirements. At this time, no FDIC insured deposit sweep vehicle is available at Pershing for fee-based retirement accounts.
How does the availability of the Deutsche Bank Insured Deposit Program affect existing accounts held at Pershing?
Existing accounts will remain in current money market fund sweep vehicles unless the client provides instructions to their financial professional requesting participation in the Program.
What is the difference between coverage provided by FDIC and SIPC?
SIPC provides protection from insolvency of a broker/dealer while funds are held by Pershing/Securities America, Inc.. FDIC provides protection of principal and interest while funds are held in the bank deposit account. Further description of FDIC coverage is available at www.fdic.gov.
What are Cash Balance Tiers and how are they assigned?
A tier refers to the ranges of cash balances that determine what rate will be paid on the cash inside the Deutsche Bank Insured Deposit Program as shown below. All account balances in a household are combined to determine the applicable tier for a client’s accounts. Household accounts are defined (and automatically linked) as accounts registered with the same Social Security Number. Each month on the statement cutoff date, the average cash balance in household accounts since the previous statement cutoff will be computed and assigned to one of the tiers. If cash balances change, it might move the balance from one tier to the next or even move several tiers. The cash in all of a client’s household accounts is aggregated to determine the tier.
- $1,000,000 or greater
- $500,000 up to $1,000,000
- $100,000 up to $500,000
- $50,000 up to $100,000
- Less than $50,000
How do Deutsche Bank Insured Deposit Program rates compare to bank checking and savings rates?
The rates paid under this program may be higher than some banks pay for checking and savings account balances that do not have minimum balance requirements. There can be exceptions, however, but rates offered under this Program can be more competitive than those offered by large national banks. Keep in mind that making these comparisons can be difficult because there is much more involved than just the rate paid. The Deutsche Bank Insured Deposit Program is unique in that it pays a savings-like rate of interest but has the transaction flexibility of a brokerage account (including available check writing features), no penalties for failure to maintain minimum balances, and no penalties for early withdrawals.
How do Deutsche Bank Insured Deposit Program rates compare to other broker/dealer rates?
Not all broker/dealers offer insured bank deposit sweep vehicles or have the same access and convenience features. Compared to broker/dealers that do offer a similar product, the rates offered by the Program are competitive.
Will there be any impact on check writing, debit or credit card features on my account?
There will be no changes to any of the check writing features or debit or credit card features currently in use with your account.
Where can I get additional information about rates or conversion of existing accounts?
Contact your financial professional to get additional information or contact Securities America, Inc..
Mutual funds are investments involving risk and are offered by prospectus only. Investment return and principal value will fluctuate so that upon redemption an investor's shares may be worth more or less than original value. An investor should carefully consider the investment objectives, risks, charges and expenses before investing. The fund prospectus contains this and other information about the investment company. For a copy of the prospectus, please contact your financial professional. Read the prospectus carefully before investing or sending money.
An investment in a money market fund is not FDIC insured or guaranteed by any other government agency. Although the fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the fund.