Account Ownership Category Allocation Methods

R&T utilizes two primary Account Ownership Category Allocation Methods based on the Customer Identifier of the primary customer associated with each customer account provided to R&T.

Single Account Ownership Category (S-AOC)

This is the default methodology designed to reduce the risk of underinsurance.

• Logic: R&T seeks to allocate up to the SMDIA (currently $250,000) per Customer Identifier, per Receiving Institution, up to the Single Account Ownership Category Program Limit¹.

• Result: Customers receive access to deposit insurance up to the Sending Institution's Program Limit.

• Constraint: This limit applies regardless of whether the Participating Institution provides multiple ownership categories for that specific customer.

Multiple Account Ownership Category (M-AOC)

Participating Institutions may elect to use the M-AOC method if they wish R&T to rely on the specific ownership category data provided in the registration files.

• Logic: R&T seeks to allocate up to the SMDIA per Customer Identifier, per Account Ownership Category, per Receiving Institution.

• Benefit: This allows for a higher M-AOC Program Limit² for customers with diverse account types (e.g., a Customer with both an Individual and a Joint account).

• Requirement: To use this method, the Participating Institution must submit a M-AOC Set Up Form.

The Automated Exception Process

To prevent Customers from experiencing a reduced Program Limit under the default S-AOC method, R&T runs an automated exception process.

Identification

If the system detects a Customer would receive a higher Program Limit via the M-AOC methodology, it automatically applies that methodology.

Reporting

R&T provides an Exception Report to the Participating Institution identifying these Customers.

90-Day Decision Window

The Participating Institution has 90 days to choose one of two paths for Customers on this report:

Program Limits and Excess Funds

The Program Limit is the maximum insurance coverage available for access by a Customer under the DDM Program.

Notification

R&T makes the "DDM Program Update Notice" available (typically on Mondays) listing the current Program Limits for both S-AOC and M-AOC.

Excess Institutions

If a Customer’s funds deposited into the DDM Program exceed the Program Limit, the excess is allocated to one or more Excess Institutions. These funds may not be eligible for Deposit Insurance coverage.

What's Next

• Learn how to manually override automated allocations and manage customer-specific bank preferences in Receiving Institution Opt-Outs.

• Review how the DDM Program applies gross and net rates to these insured balances in Customer Interest Rate Mechanics.

^{1 Your firm’s “Program Limit” is the maximum amount of deposit insurance coverage that your firm may make available to an eligible depositor (e.g., based on TIN) under the DDM Program, subject to the customer terms and conditions, opt-outs and applicable laws and regulations. Contact R&T for your firm’s current “Single Account Ownership Category (S-AOC) Program Limit”. R&T also sends a weekly email (typically on Monday), titled “DDM Program – Weekly Update for [Name of Your Firm]” which includes the Program Limit. If an eligible depositor places funds into the DDM Program above your firm’s Program Limit, R&T shall be entitled to allocate those excess funds to any receiving institution (known as an ‘excess institution’), and those excess funds may not be eligible for deposit insurance coverage.}

^{2 Contact R&T for your firm’s current “Multiple Account Ownership Categories (M-AOC) Program Limit”. R&T also sends a regular DDM Program Update email which will include your firm’s Multiple Account Ownership Categories Program Limit. If your Customer places funds into the DDM Program above your firm’s Multiple Account Ownership Categories Program Limit, those excess funds may be placed into deposit accounts at any Receiving Institution (known as an Excess Institution) and those Excess Funds will not be eligible for deposit insurance coverage under the DDM Program (subject to applicable laws or regulations that may permit eligibility).}