What is the difference between Tiering Method “A” and Method “B”?
Tiering method “A” assumes interest is paid on the entire deposit amount at the interest rate in the particular band that the deposit amount falls. For advertising and account disclosures, the A.P.Y. must be disclosed for each band. For non-time accounts, the [APY/%] routine is used for each band. For time accounts, the [APY/Int] routine is well as for calculating the A.P.Y. earned (in the case of periodic statements). Tiering method “B” assumes an interest rate is paid only on that portion of the deposit within the specified tier. The [Tier] function key is used to calculate a minimum and maximum A.P.Y. for each tier level.
Tiering method “A” (sometimes called “banded”, “hybrid” or “plateau” accounts) assumes the dividend is paid on the entire deposit amount at the dividend rate in the particular band that the deposit amount falls. For advertising and account disclosures, the A.P.Y. must be disclosed for each band. For non-time accounts, the [APY/%] routine is used for each band. For time accounts, the [APY/Int] routine is used for both the advertising and account disclosures as well as for calculating the A.P.Y. earned (in the case of periodic statements). Tiering method “B” (also called a “pure” tier account) assumes a dividend rate is paid only on that portion of the deposit within the specified tier. The [Tier] function key is used to calculate a minimum and maximum A.P.Y. for each tier level.
