Docstoc

Ohio Credit Union Business Checking Account Guide

Document Sample
Ohio Credit Union Business Checking Account Guide Powered By Docstoc
					mbs
OCUL Services Corporation
Member Business Services Task Force




Ohio Credit Union
Business Checking
Account Guide

                         Prepared by Dave Shoup
                         Director of Research & Information
                         Ohio Credit Union League

                         Under the Direction of the
                         OCUL Services Corporation
                         Member Business Services Task Force

                         August 2002
                         www.OhioCreditUnions.org/mbs.htm
                          TABLE OF CONTENTS

Acknowledgments


Section I: Introduction

   ➤ OSC’s Member Business Services Task Force.

   ➤ Background: Understanding today’s Member Business Services Market and Environ-
     ment.


Section II: Potential of Establishing Business Checking Account Relationships

   ➤ Opportunities, challenges and strategies.

   ➤ Where do you start?


Section III: Business Structures and their Eligibility for Membership

   ➤ A review of the various and unique business structures a credit union could serve, includ-
     ing unincorporated relationships, sole proprietors, limited liability companies, partner-
     ships, and corporations.

   ➤ How do business entities become eligible for membership within the confines of the
     credit union charter/articles of incorporation?


Section IV: Forms, Documentation, and Instructions

   ➤ Forms packages and instructions available.

   ➤ Characteristics of business entities in Ohio and how they are legally filed with Ohio’s
     Secretary of State Office.

   ➤ Business Account Documentation — a review of business documents needed before
     opening accounts and to ensure business authenticity.

   ➤ Creation of Business Depository Accounts (chart developed by Corporate One FCU):
     Properly titling business entities on account cards/contracts; needed support documenta-
     tion from business entity; account styling; ownership; transaction authority; taxpayer
     identification numbers; and examples.
Section V: Credit Union Business Account Forms
       — Form templates and instructions, developed by Corporate One FCU.


Section VI: Pricing of Business Checking and Savings Accounts

   ➤ Guidelines and strategies.

   ➤ Issues and considerations when establishing a pricing plan.

   ➤ Typical business account fees.

   ➤ Market data.

   ➤ Sample credit union and bank pricing plans.



Section VII: Regulatory Issues/Policies and Share Insurance Coverage

   ➤ Risk Management/Liability Issues

   ➤ Disclosures: Review of needed regulatory disclosures relating to depository accounts
     including Truth-in-Savings (TIS), Funds Availability (Regulation CC), and Electronic
     Funds Transfers (Regulation E).

   ➤ Review of National Credit Union Share Insurance Fund (NCUSIF) and American Share
     Insurance (ASI) coverages of business accounts.


Section VIII: Resources

   ➤ Additional resources to contact for assistance in starting a member business services
     program at your credit union.
                   ACKNOWLEDGMENTS
           Special thanks to the following who contributed to the production
            of the Ohio Credit Union Business Checking Account Guide.




                             mbs
                             OCUL Services Corporation
                             Member Business Services Task Force

Rose Bartolomucci, Chair                       Thomas Poe
Kent Credit Union, Inc.                        Wright-Patt Credit Union, Inc.

John Bowen                                     Scott Rutherford
River Valley Federal Credit Union              CODE Credit Union, Inc.

Glenn Culler                                   Jack Sarver
Ackerman Credit Union                          TeleCommunity Credit Union, Inc.

Russell Fisher                                 Michael Spindler
Century Federal Credit Union                   Mead Employees Credit Union, Inc.

Tom Furrey                                     Liaisons: Ohio Credit Union System
Western Credit Union, Inc.                     Paul Mercer
                                               Dave Fearing
James Johnson                                  Dave Shoup
Hopewell Federal Credit Union                  Mike Gaylord
                                               Kim Stamps
Ann Masterson
Greater Warren Community FCUnion               Mike Paton, Corporate One FCU
                                               Lea Rinehart




Keith Reynolds, CEFCU

AACUL Business Activities Committee

CUNA’s Business/SEG Services Committee

CUNA Mutual Group
   Section I:
Introduction
                                          SECTION I:
                                        INTRODUCTION

In 2001, the Ohio Credit Union League Services Corporation (OSC) appointed a Member
Business Services (MBS) Task Force to investigate the potential opportunities for credit unions in
offering business products and services to their membership. As credit unions continue to
expand their field of memberships to more employer, associational and community groups, more
members are requesting business deposit and loan services, along with various other ancillary
services such as check imaging, cash management services, payroll services, merchant card
processing, insurance, retirement services, and more.

The complexity of the member business services relationship varies widely, depending on the
nature of the business. Sound procedures, internal controls, targeted marketing and well-trained
staff are the key ingredients in attracting, maintaining, and protecting the credit union from any
potential losses. Initially, credit unions do not need to offer services to all potential business
customers. Credit unions can expand their programs as their expertise and experience grow.

At the core of the MBS relationship is the business deposit account relationship – primarily
checking and savings products. By far, this is the most requested service from business owners.
Statistics cite that eventually 50% of these businesses will likely seek loans in the future. Once
the checking/savings account relationship is solidified, the growing relationship and high degree
of regular contact provides the credit union many more opportunities to cross-sell ancillary
services.

The seven most important financial products that small businesses use (in no particular order)
according to the Manhattan Consulting Group in a study for the Applied Research Institute,
California Credit Union League, include:

     ➤ Operating accounts (checking and money market)
     ➤ Basic cash management
     ➤ Merchant card processing
     ➤ Payroll processing
     ➤ Credit (secured and unsecured)
     ➤ Retirement and other employee benefit plans
     ➤ Casualty and key employee insurance

This “Ohio Credit Union Member Business Checking Account Guide” will provide you the
background, operating forms and instructions, policy and pricing guidelines, research findings
and additional resources to assist in deciding whether business services is right for your credit
union. Each credit union will need to determine on its own (in conjunction with their attorney
and/or advice from the Ohio Credit Union System and other parties) what modifications are
needed to agreements, disclosures, policies, etc.




Ohio Credit Union Business Checking Account Guide                                                1-1
The goal of the MBS Task Force has been to provide a useful tool to empower credit union
management and officials to identify the key decisions and processes necessary to implement,
operate and expand business accounts. The information provided will ease credit unions’ initial
compliance concerns and create the initial confidence needed to begin MBS services. The Guide
will alleviate the daunting task and feelings that each credit union is “on their own” or “starting
from scratch” when exploring MBS programs.


Background

Credit unions have a rich history in providing personal, friendly, efficient and lower cost financial
services to their members. Their success, through a philosophy of “people- helping-people,” has
gained the industry positive reviews from the press to Capitol Hill, and fueled credit unions’
growth to higher and higher levels. Credit unions’ success can be traced to the dedication and
combined efforts of credit union management, volunteers, staff, state credit union leagues,
CUNA, regulators, and more.

Credit unions continue to reach out and serve those who have never experienced the “credit
union difference”, through expanding their fields of membership into more and larger employer,
associational, and community groups. Part of their success over the past ten to fifteen years, is
attributable to the fact that their primary competition (banks, savings & loans, finance companies,
etc.) have “turned their backs” on the small investor and have concentrated their efforts on more
affluent individuals and larger businesses that drive profits and the bottom line. The average
individual and small business have witnessed large increases in account maintenance fees and, at
the same time, substantial decreases in the personal service levels offered. Along with the ongo-
ing consolidation of banks into mega conglomerates, service levels and fees have reportedly
worsened even further.

Not unexpectedly, frustrated small business owners have looked for alternatives elsewhere.
Today, credit unions find themselves in the perfect position to take advantage of the opportunities
to serve these small businesses left out in the cold.




Ohio Credit Union Business Checking Account Guide                                                 1-2
                 Section II:
  Potential of Establishing
Business Checking Account
             Relationships
                     SECTION II:
          POTENTIAL OF ESTABLISHING BUSINESS
           CHECKING ACCOUNT RELATIONSHIPS

There are more than two million small businesses in the United States, defined by
TowerGroup (a national financial services research firm) as businesses with annual sales between
$500,000 and $10 million. A major TowerGroup study in August 2001, “Beyond Credit: Product
Opportunities in the Small Business Market,” identified the following highlights:

     ➤ Checking and deposit account relationships account for 70% or more of the profitability
       associated with small account relationships. Financial institutions have had a tendency to
       focus their resources on marketing credit services, and although important to solidify
       relationships, checking and deposit accounts more often “cement” the institution as the
       business’ primary financial provider and offer greater opportunities to cross-sell credit
       and ancillary services (i.e. ACH payments, wire transfers, cash management, group
       insurance, electronic bill payment, retirement, etc.). . The average balance of a small
       business checking account for a primary provider financial institution is $69,450.

     ➤ Small business account relationships (including deposits, loans and ancillary services) can
       be up to 10 times as profitable as the general consumer segment.

     ➤ A small business deposit account is relationship and service driven. Credit unions
       already excel in this market and many credit unions have demonstrated success in attract-
       ing businesses tired of the high fees and poor service levels of large banks, whose primary
       target has been the large corporate customer in recent years.

Any credit union seriously examining the potential of offering business services to their member-
ship should obtain a copy of the full TowerGroup report. Significant insight and statistics on the
business market are presented and are helpful in better understanding the potential of how
business deposit services could benefit your credit union. The full report can be obtained
through CUNA at www.cuna.org.

The consumer market alone presents only marginal opportunities, according to a recent study,
“Meeting the Needs of Small Business” conducted by the First Manhattan Consulting Group,
through the California Credit Union League Research Council. The study sites factors of why
credit unions should expand their service offerings to include business account relationships, due
to decreased margins on credit and deposit products, and due to higher percentages of household
account relationships that are unprofitable. In short, 20% to 30% of members who are high users
of credit union services subsidize the 70% to 80% of members whose contribution to income
generated falls in varying levels below break even.

This is not the typical case with business account relationships that can generate substantially
more income and can result in benefiting the entire credit union’s bottom line (along with the
entire credit union membership). In short, business accounts are profitable accounts many credit
unions cannot afford to ignore…especially now, when more are knocking at the credit union’s


Ohio Credit Union Business Checking Account Guide                                              2-1
front door. According to California Credit Union League MBS study, “The real opportunity lies
in the deposit side [of business accounts], where credit unions can offer a sterling alternative to
the commercial banks. Banks set much higher service charges for such accounts than for compa-
rable consumer deposit products. Their pricing policies and service levels make them vulnerable
to credit unions.”

For most credit unions, the real motivating incentive to jump into the business services arena will
simply be the opportunity to provide a needed member and community service. As credit unions
grow and extend their reach into communities, the greater the civic responsibility to help the
local business needs of the areas served.

Businesses come in all sizes and shapes, from large corporations to small companies employing
only a few individuals, to the sole proprietor. Credit unions are eligible to serve all these, as long
as they are within the credit union’s field-of-membership (discussed in a later section).

Should credit unions serve all these groups? Yes, as long as the credit union can meet the service
demands of the business. Obviously, a credit union just starting business services will probably
not be able to service a large company with potentially thousands of checks for deposit each
month, and who requests sophisticated cash management services, tax preparation help, and
credit card processing services. The credit union (and potentially its data processor) simply does
not have such expertise or capabilities – yet. However, if the same corporation is requesting a
basic checking account for one of its divisions, the credit union should be able to offer the
service.

Until such time that credit unions gain MBS expertise, credit unions should generally concen-
trate their efforts in the small business market – and that’s the GOOD news! According to both
the California study and a new comprehensive study commissioned by CUNA through PSI
Global, a huge market currently exists among the “Small Office/Home Office” market, com-
monly referred to as the SOHO market

Consider the following facts about SOHOs:

     ➤ There are 6.8 million SOHOs in the U.S. today, defined as full time businesses with
       annual sales between $50,000 and $500,000.
     ➤ 91% of SOHOs have fewer than five employees.
     ➤ While the majority of SOHO business owners consider a bank to be their primary
       provider, more than a third (2.4 million) are credit union members.
     ➤ SOHO owners tend to consolidate all their business and personal accounts with one
       financial institution.
     ➤ Among business checking and savings account holders, two-thirds use some form of
       credit product, usually from their primary provider. Credit unions only currently have
       an 18% market share of this credit business.
     ➤ Only 2% of the SOHO market uses a credit union for business purposes exclusively.
     ➤ SOHO business owners are changing providers and switching accounts at a higher rate
       than seen in years, citing less personal service, less responsiveness to questions or prob-
       lems, and increases in fees.




Ohio Credit Union Business Checking Account Guide                                                   2-2
Since the complexity of requested business services generally increases as the size and complexity
and needs of the business increases, the SOHO market provides the perfect opportunity to gain
an entrance into the business market. As stated before, most credit unions will find it wise to
begin limited MBS services, and expand offerings as experience is gained. The opportunities to
serve the SOHO market are great. In fact, many of your current members are probably part of
the SOHO market. Many are probably frustrated with the pricing and servicing of their current
banking relationships and never considered the credit union (who they may love for their per-
sonal accounts) as being a business account alternative.


Where do you start?

You have come to the right place! This Small Business Checking Account Guide is primarily
focused in guiding the beginning credit union in establishing a business checking account pro-
gram. Many operational and policy decisions will need to be addressed by credit union manage-
ment and directors. Although this guide is not a total “turn-key” solution, it will help jumpstart
your credit union’s own business services planning committee efforts and provide a better
understanding of key issues, including:

     ➤ The overall business market potential today
     ➤ Policy issues
     ➤ Business account structuring rules
     ➤ Marketing/promotional considerations
     ➤ Business account forms and instructions
     ➤ Pricing strategies
     ➤ Regulatory disclosures
     ➤ Account policies
     ➤ Share insurance coverage
     ➤ Additional resources.



For Additional Assistance

For additional information, please call the Ohio Credit Union System at 800-486-2917. Also
refer to Section VIII: Additional Business Account Resources.




Ohio Credit Union Business Checking Account Guide                                               2-3
             Section III:
Business Structures and
     Their Eligibility for
            Membership
                           SECTION III:
                BUSINESS STRUCTURES AND THEIR
                  ELIGIBILITY FOR MEMBERSHIP

Credit unions are very accustomed to the procedures, requirements and restrictions in determin-
ing an individual’s eligibility for membership. A credit union’s charter (federal credit unions) or
Articles of Incorporation (state credit unions) — and accompanying field-of-membership amend-
ments over time, determine who can be served, including family members. At times, determin-
ing eligibility for membership can become unclear and one must refer to NCUA or State rules
for assistance.

Federal and state credit unions have the legal authority to offer membership to entities as well,
including organizations, associations, corporations, etc. The Federal Credit Union Act defines a
federal credit union as a cooperative association organized in accordance with the Act’s provisions
“for the purpose of promoting thrift among its members and creating a source of credit for
provident and productive purposes.” The Act also provides that “federal credit union member-
ship shall consist of incorporated and unincorporated organizations to the extent permitted by the
board, as may be elected to membership.”

Ohio credit union laws permit state chartered credit unions to provide membership to businesses
and other organizations in the same manner (Ohio Credit Union Act, Section 1733.05). Credit
unions are advised to review their Charter and Bylaws (if federally chartered), or Articles of
Incorporation and Code of Regulations (if state chartered), for proper wording (see item #3
below), or any language that would hinder the ability to serve businesses or “groups composed of
such persons” or the like. Nearly all credit unions currently have proper wording in their Char-
ter or Articles of Incorporation.

To become a member of the credit union, a business needs to fall in only one of the following
three categories:

     1. If specifically cited as being within the credit union’s field of membership. For
        example, if XYZ credit union’s charter serves “Employees of Jerry’s Electronic Services,
        Inc.”, the company is authorized (in addition to the employees) to establish a member-
        ship account at the credit union. In fact, if XYZ Credit Union is a multiple group char-
        ter, all its approved membership groups are eligible for business accounts.

     2. If within the field-of-membership of a community charter. For community-
        chartered credit unions (federal or state chartered), all businesses domiciled within the
        geographic boundaries specified in the credit union’s charter are eligible to establish a
        business account. Since Ohio state-chartered credit unions may also serve groups outside
        the geographic boundaries, these groups/businesses may also establish business accounts.

     3. If the credit union’s charter includes “organizations of such member.” Members
        who own or who are associated with organizations, associations or businesses may allow
        the business/organization to establish a business account if the credit union’s charter


Ohio Credit Union Business Checking Account Guide                                               3-1
          includes wording such as “organizations of such member” (or like wording). However,
          all business/organization owners (if the credit union is federally chartered) or a majority
          of owners (if state-chartered) must be eligible for membership on an individual basis for
          the business/organization to be eligible for membership under “organizations of such
          member.” The chart below illustrates membership eligibility under “organizations of such
          member, based on business structure.
          Note: Does not apply if the business is eligible under categories 1 or 2 above!


              Business Structure                              Membership Eligibility Under
                 Description                                “Organizations of Such Members”

Unincorporated Associations
Definition: a group of individuals who own a               For FCUs, all individual members of the club
not-for-profit business and that is not incor-             must be eligible for credit union membership
porated (or required to do so) under the state             for the unincorporated association to establish
in which they are domiciled.                               a business account.

Unincorporated associations are generally                  For State CUs, the majority of individual
referred to as “Club” accounts. Examples                   members must be eligible for membership.
include bowling leagues, Cub Scouts, class
reunion accounts, investment club accounts, etc.


Sole Proprietorship
Definition: An individual (or, in rare cases, two          The sole proprietor/business owner must be
people) who owns an unincorporated, for-                   individually eligible for credit union member-
profit business, generally under an assumed                ship.
name.

Usually, the owner files an “Assumed Name
Certificate” if doing business in any other
name other than their own.


Limited Liability Company (LLC)
                                                           For FCUs, all LLC owners must be individu-
Definition: An unincorporated membership
                                                           ally eligible for membership to establish a
organization usually set up to derive the
                                                           business account.
benefits of protection from individual liability
enjoyed by corporations, while at the same
                                                           For State CUs, the majority of LLC owners
time permitting the income tax advantages of a
                                                           must be individually eligible for membership
partnership.
                                                           to establish a business account.
Professional limited liability companies
(PLLC) also exist to render one or more
licensed professional services. PLLCs include
doctors, certified public accountants, chiro-
practors, dentists, veterinarians, architects,
professional engineers, and attorneys.
                                              — continued next page —
Ohio Credit Union Business Checking Account Guide                                                       3-2
              Business Structure                        Membership Eligibility Under
                 Description                          “Organizations of Such Members”

Partnership
Definition: An association of persons who            For FCUs, all partners must be individually
share risks and profits in a business or other       eligible for membership to establish a business
joint venture. Partners are generally liable for     account.
the debts of a partnership.
                                                     For State CUs, the majority of partners must
A “limited partnership” is formed by two or more     be individually eligible for membership to
people under the laws of a state, which includes     establish a business account.
one or more general partners, and one or more
limited partners, as identified in the partnership
agreement. Generally speaking, general part-
ners are liable for the partnership’s debts, and
limited partners are not.


Corporation
Definition: A corporation is a legal entity          For FCUs, all shareholders must be individu-
separate from its owners. Webster’s Dictio-          ally eligible for membership to establish a
nary defines a corporation as “a body or             business account.
society entitled to act as a single person; an
artificial person created by charter, made up of     For State CUs, a majority of all shareholders
many persons or one person.” In general,             must be individually eligible for membership
shareholders are not personally liable for the       to establish a business account.
corporation’s debts.
                                                     Usually, a corporation will be eligible for
                                                     membership because it is a primary sponsor
                                                     group or added as a select group, requiring
                                                     regulator approval.




Ohio Credit Union Business Checking Account Guide                                                  3-3
           Section IV:
Forms, Documentation,
      and Instructions
               SECTION IV:
   FORMS, DOCUMENTATION & INSTRUCTIONS

Business Checking/Savings Account Forms

Accurate, legally compliant business account forms are critical to the smooth operations and
protection of any credit union seeking to expand into business services. To assist Ohio credit
unions, OSC’s Business Services Task Force sought a variety of solutions to give Ohio credit
unions options to which business account agreements/contracts would best meet their needs.

     ➤ Corporate One Federal Credit Union, represented on the Business Services Committee,
       offered to develop a template business account forms package and to make them available
       to Ohio credit unions. These forms are located in Section V.

          The Ohio Credit Union System and the Business Services Task Force are grateful to Corpo-
          rate One for this generous investment. They are provided to credit unions free of charge.


The following are various business account forms options available to credit unions:

     1. Business Account Agreement templates and instructions from Corporate One
        Federal Credit Union (Section V). These documents and instructions are not in-
        tended as legal advice. Developed by Corporate One FCU’s legal counsel and staff in
        2002, they should be reviewed by your own credit union’s legal counsel before using to
        open accounts.

          These forms are not copyrighted and may be changed/modified by credit unions and
          their attorneys as needed. They should also be reviewed by counsel regularly to ensure
          that all documents and policies remain current. These forms are available on Corporate
          One FCU’s website at www.corpone.org in the “Products and Services” section.

          There is no charge for the use of these Business Account Agreement templates.

     2. Deposit Account Forms and instructions from CUNA Mutual Loanliner Ac-
        count Forms (formerly from CUNA Services Group). Many credit unions are
        accustomed to these forms for opening individual member accounts. Primary account
        forms used for opening small business/organization accounts are the “Account Card” and
        the “Account Authorization Card.” A user’s guide with instructions is also available.

          For more information, contact CUNA Mutual at 1-800-356-9140.

     3. Business account forms available from other vendors. Credit unions may wish to
        contact their current forms supplier for availability of business account forms.




Ohio Credit Union Business Checking Account Guide                                                4-1
     4. Samples from other credit unions. Samples from other credit unions/financial
        institutions should be used as guidelines only when proper permission for use is received.
        Review by legal counsel is imperative.

          A few credit union forms samples are available on CUNA’s website at www.cuna.org in
          the Business/SEG Services Center.



Additional Legal Disclosures for Business Accounts

Credit unions are highly advised to supplement signature cards with “Account Agreements,”
reviewing credit union regulatory and policy issues affecting all membership accounts. Although
not a legally required disclosure, account agreements outline account policies in regards to such
items as access to accounts, Uniform Commercial Code provisions, rights of the credit union to
close accounts, requirements to notify credit union of changes to account access, distribution of
funds upon the death of an account owner, and many other provisions.

Credit unions familiar with CUNA Mutual Loanliner Deposit Account Documents are familiar
with the “Membership Account Agreement” disclosure form, as provided to all new accounts.

Corporate One FCU’s Business Account Forms (see appendix) recommends the following
sample language be inserted into account agreements to accommodate business relationships:

Accounts of Businesses and Organizations. Accounts held in the name of a business, organization, or
association member are subject to all of the conditions and terms contained in this Agreement for natural person
accounts, and the following additional rules. The Credit Union reserves the right to require the business
member to provide an account authorization card or other documentary evidence satisfactory to the Credit Union
informing the Credit Union who is authorized to act on the business member’s behalf. No POD beneficiary
designation or other designation shall apply to the account. You agree to notify the Credit Union of any change
in this representative authority of your agent. The Credit Union may rely on your written authorization until
such time as the Credit Union is informed of changes in writing and has had a reasonable time to act upon such
notice. The Credit Union may require that third-party checks payable to a business may not be cashed, but
must be deposited to a business account. You agree that the Credit Union shall have no notice of any breach of
fiduciary duties arising from any transactions by any agent of the account owner, unless the Credit Union has
actual notice of such breach.




Ohio Credit Union Business Checking Account Guide                                                            4-2
                                Summary of Business Entities in Ohio

 Type of Entity                            Characteristics                   How Filed in Ohio

Sole                     • Simple to create, inexpensive               Trade Name with Secretary of
Proprietor               • Income reported on personal taxes.          State
                         • Owner personally liable for business debt
                         • Ends at owner’s death

General                  • Simple to create, inexpensive               Trade Name with Secretary of
Partnership              • Created by contract                         State
                         • Partners report their share of profit or
                           loss on their personal tax returns
                         • Partners personally liable for death
                         • May cease at death of a partner, unless
                           partnership agreement

Limited                  • Two classes of partners a) general and b)   Certificate of Limited
Partnership                limited                                     Partnership
                         • Suitable primarily to companies that
                           invest in real estate                       Foreign limited partnership
                         • Limited partners are basically investors    will register with the Secretary
                           and have no say in the business             of State
                         • Generally partners personally liable

Limited                  • A new type of business ownership which      Partnership Agreement filed
Liability                  has features of partnership, with limited   with the Secretary of State
Partnership                liability like a corporation
                         • Created by agreement                        Registry of Partnership is
                                                                       issued

Corporation              • Many types of corporations: C Corp, S       Articles of Incorporation are
                           Corp, Professional Corp, Nonprofit          filed with Sec. of State office
                           Corp
                         • Does not cease at death of shareholders –   License required for Foreign
                           owners have limited liability               Corporation
                         • Corporation files taxes on its own

Limited                  • A hybrid between a corporation and a        Articles of Incorporation are
Liability                  partnership                                 filed with the Sec. of State
Company                  • Limited liability to the members
                         • Tax treatment as a partnership requires     Foreign Limited Liability
                           strict compliance with IRS guidelines       Company must register with
                                                                       Secretary Of State’s office


 Secretary of State Forms Website: www.state.oh.us/sos/aspfiles/indexmain.asp
 Ohio Secretary of State Telephone for Business Services: 1-877-767-3453

 *Source: Technical Training Systems 2002


Ohio Credit Union Business Checking Account Guide                                                    4-3
Obtaining Business Account Documentation*

The purpose of obtaining business documentation is to assure that the business is legitimately
owned and operated by the person attempting to open the account. Business accounts can be
opened fraudulently for several reasons:

     ➤ To pass stolen checks made payable to a legitimate business.
     ➤ To defraud the public by establishing a bogus business and collecting money for services
       or goods.
     ➤ To pass counterfeit checks made payable to a bogus company.

Most business account fraud is committed by recently established businesses. It is critical that
credit unions collect documentation that ensures a comfort level with the business and its own-
ers. There are no laws that outline which documents must be collected. It is a financial
institution’s fiduciary and safety and soundness responsibility to verify the validity of a business.

The amount of documentation received is a matter of risk management, credit union policies and
the desires of local regulators. Generally, when key documentation is omitted, the credit union
should have sound business reasons for their exclusion.

A credit union should only accept original copies of documents. Photocopying the originals for
the member’s file is acceptable. Note: Copies of State of Ohio filing forms are available at
www.state.oh.us/sos/asp/indexmain.asp.

Some documents, such as business licenses and seller’s permits are not required by some cities or
counties. This does not mean the business is not legitimate. It means that a credit union will
need to go an extra step in verifying additional information regarding the business. Examples
include contractor’s licenses, business tax certificates, and city tax certificates.

The following documentation is recommended for opening business accounts. Refer to
Corporate One FCU’s form templates and instructions in Section Five for more details.


Sole Proprietorship
     •    Completed business signature card.
     •    Filed Fictitious Name Certificate (if other than member’s own name) – not less than 30
          days old.
     •    Proof of publication.
     •    60 days of previous business bank statements (if business is new, 60 days of personal bank
          checking statements).
     •    Certification of Tax ID or Social Security Number
     •    Business License/Sales Tax Certificate/Seller’s Permit (may be optional in some cities or
          counties).
     •    Appropriate identification for all signers.
     •    Signatures of all authorized signers – must sign in person or have their signature nota-
          rized on the Signature Card.

Ohio Credit Union Business Checking Account Guide                                                    4-4
General/Limited Partnership
     •    Completed business signature card.
     •    Certificate for Opening Partnership Account
     •    Certificate of Limited Partnership.
     •    Partnership Agreement and Filed Fictitious Name Certificate if limited partnership.
     •    Proof of publication.
     •    60 days of previous business bank statements (if business is new, 60 days of personal bank
          checking statements).
     •    Certification of Tax ID
     •    Business License/Sales Tax Certificate/Seller’s Permit (may be optional in some cities or
          counties).
     •    Appropriate identification for all signers.
     •    Signatures of all authorized signers – must sign in person or have their signature nota-
          rized on the Signature Card.


Limited Liability Company
     •    Completed business signature card.
     •    Certified Copy of Resolution.
     •    Management Agreement.
     •    Articles of Incorporation.
     •    60 days of previous business bank statements
     •    Certification of Tax ID.
     •    Business License/Sales Tax Certificate/Seller’s Permit (optional in some cities or coun-
          ties).
     •    Appropriate identification for all signers.
     •    Signatures of all authorized signers – must sign in person or have their signature nota-
          rized on the Signature Card.


Unincorporated Association, Religious, Charitable, Educational or Tax Exempt Organization
     •    Completed business signature card.
     •    Certified Copy of Resolution
     •    Articles of Incorporation
     •    Certificate of Good Standing (if not incorporated)
     •    By-Laws (must include statement confirming non-profit status in accordance with IRS
          code).
     •    60 days of previous business bank statements
     •    Certification of Tax ID.
     •    Signatures of all authorized signers – must sign in person or have their signature nota-
          rized on the Signature Card.


Ohio Credit Union Business Checking Account Guide                                                    4-5
Corporation
     •    Completed business signature card.
     •    Certified Copy of Resolution
     •    Articles of Incorporation.
     •    Certification from Secretary of State.
     •    60 days of previous business bank statements
     •    Certification of Tax ID.
     •    Signatures of all authorized signers – must sign in person or have their signature nota-
          rized on the Signature Card.
     •    Minutes of meeting stating instructions to open account.




*Excerpts from Telesis Community Credit Union, California



Ohio Credit Union Business Checking Account Guide                                                    4-6
                           Creation of Business Depository Accounts*




*Created by Corporate One FCU


Ohio Credit Union Business Checking Account Guide                      4-7
1
  Accounts are insured up to a maximum of $100,000. For a lawyer’s trust account where clients’ funds are commingled, each client is
insured to a maximum of $100,000.
2
  A business is required to have an EIN if it pays wages to one or more employees or files pension or excise tax returns. An EIN may be
requested from the Internal Revenue Service using Form SS-4 and takes about 30 days to receive the EIN.
3
  Unincorporated organizations such as this should obtain an EIN from the Internal Revenue Service. Using the social security number
of an organization’s member may create future problems, especially if the business account will have income that needs to be attributed
for tax purposes or the member terminates affiliation with the organization, becomes incapacitated or dies.
4
  Attorneys in Ohio are required to establish interest-bearing trust accounts on which the interest must be paid to the Treasurer of the
State of Ohio for the benefit of the Ohio legal aid fund. See Ohio Revised Code §§ 4705.09 and 4705.10. An Ohio lawyer may
establish and maintain an interest-bearing trust account with any credit union insured by the National Credit Union Administration.
Helpful information concerning Interest on Lawyers Trust Accounts (“IOLTAs”) may be found on the Legal Assistance Foundation of
Ohio’s website at www.olaf.org.




Ohio Credit Union Business Checking Account Guide                                                                                   4-8
           Section V:
Credit Union Business
       Account Forms
     Form template and instructions,
     developed by Corporate One FCU
             SECTION V:
CREDIT UNION BUSINESS ACCOUNT FORMS
             provided by: Corporate One Federal Credit Union


   Please Note:
   Corporate One is pleased to provide the Business Account Agreement
   templates and the accompanying instructions for completing these
   documents when your credit union establishes a depository relation-
   ship with a business entity. These documents and instructions are not
   intended as legal advice. They should be reviewed by your credit
   union’s legal counsel before you begin using them to open accounts.
   They should also be reviewed by counsel regularly to ensure that your
   documents and policies remain current.
Document                                                                                                   Tab #

Insert to Account Agreement (All Business Accounts) ............................... 1

For use by All Business Entities ......................................................... 2

    • Business Account Signature Card

Sole Proprietorship Forms ................................................................ 3

    • Certificate for Opening Sole Proprietor Account

Partnership Forms .......................................................................... 4

    • Certificate for Opening Partnership Account

For use by Corporations, Limited Liability Corporations
and Unincorporated Associations ....................................................... 5

    • Certified Copy of Resolutions


Power of Attorney Forms:

    • Limited Power of Attorney to Act for Sole Proprietor with Respect to
        Deposit Accounts with__________________________Credit Union
        (“Credit Union”) ........................................................................................ 6



    • Limited Power of Attorney to Act for Partnership with Respect to
        Partnership Deposit Accounts with _________________________
        Credit Union (“Credit Union”) ................................................................ 7
TAB 1
          INSTRUCTIONS FOR BUSINESS ACCOUNT FORMS


A.   Insert To Account Agreement

     Credit unions offering business accounts may wish to amend their account agree-
     ment in order to provide provisions specific to business accounts. Sample language
     that credit unions may wish to use in this regard is found at Tab 1 in these materials.
                     INSERT TO ACCOUNT AGREEMENT


Accounts of Businesses and Organizations. Accounts held in the name of a busi-
ness, organization, or association member are subject to all of the conditions and terms
contained in this Agreement for natural person accounts, and the following additional
rules. The Credit Union reserves the right to require the business member to provide an
account authorization card or other documentary evidence satisfactory to the Credit
Union informing the Credit Union who is authorized to act on the business member’s
behalf. No POD beneficiary designation or other designation shall apply to the account.
You agree to notify the Credit Union of any change in this representative authority of
your agent. The Credit Union may rely on your written authorization until such time as
the Credit Union is informed of changes in writing and has had a reasonable time to act
upon such notice. The Credit Union may require that third-party checks payable to a
business may not be cashed, but must be deposited to a business account. You agree that
the Credit Union shall have no notice of any breach of fiduciary duties arising from any
transactions by any agent of the account owner, unless the Credit Union has actual notice
of such breach.
TAB 2
             INSTRUCTIONS FOR BUSINESS ACCOUNT FORMS

B.     Business Account Signature Card

        The Business Account Signature Card (“Signature Card”) found at Tab 2 of these
materials should be completed for each member that establishes a business account. The
Signature Card may be used for any of the types of organizations identified on the Signa-
ture Card. The majority of the information required on the Signature Card is self-explana-
tory, however, some items bear some explanation:

       1.     Separate Accounts. If a separate account number is used for each type of
account opened by the business member, the credit union should use a separate Signature
Card for each account.

       2.      Form of Organization. The organization applying for the business ac-
count should check only one of the “form of organization” boxes. That is, the member
should identify whether it is a sole proprietorship, partnership, corporation or otherwise. If
the member is organized under state law, such as a corporation, limited liability company or
limited partnership, the member should identify its state of organization in the space pro-
vided on the Signature Card.

         3.      Signature Block. The credit union should ensure that the member ex-
ecute the Signature Card in the correct signature block. Because the Signature Card is a
multi-use form, there is a separate signature block for sole proprietors, partnerships, and
corporations, limited liability corporations and associations.
                 a.     Sole Proprietors. For sole proprietors, the individual member should
sign his or her name in the space provided and type or print the name below the signature
line.
                 b.     Corporations, Limited Liability Corporations and Associations. For
corporations, limited liability corporations and associations, the signature block is a copy of
a resolution that authorizes the organization to open the account with the credit union and
to authorize certain persons of the organization to be authorized signatories on the ac-
counts open with the credit union. Because it is a copy of a resolution adopted by the
organization, the secretary or managing member must sign the signature block so desig-
nated. Also, the name of the organization should be identified on the line immediately
preceding the first line of the signature block. Persons who are authorized to sign docu-
ments on behalf of the company’s accounts must sign their names in the signature block so
designated and identify their respective titles.
                 c.     Partnerships. In the case of a general partnership or a limited part-
nership, the name of the partnership should be identified at the beginning of the signature
block for partnerships. In the case of a general partnership, all general partners should sign
in the appropriate spaces and their respective titles identified as “general partner”. In the
case of a limited partnership, the signatures of all of the general partners who are authorized
to act for the account on behalf of the limited partnership should be contained in the signa-
ture block in the same manner as for general partnerships.
                        _____________ CREDIT UNION: BUSINESS ACCOUNTS

                                BUSINESS ACCOUNT SIGNATURE CARD

                                                                           Dated: ___________________________

                                                                           Account Number __________________

____________________________________________________________________________________________
(Name of Member)
Trade name, if any: ___________________________________________________________________________
Name of Account _____________________________________________________________________________
Branch or office _______________________ Business Address ________________________________________
Mailing address (if different)
_____________________________________________________________________
Phones ______________________________ Tax ID number
__________________________________________
Initial Deposit: $_______________________

Form of organization (check one):
❑ sole proprietorship             ❑ limited liability company           ❑ non-profit corporation
❑ partnership                     ❑ corporation                         ❑ unincorporated association
                                  ❑ other ________________              ❑ religious corporation

State of organization (if applicable): _____________________

1.     Member hereby applies for the following account(s) in _______________________ Credit Union (“Credit
Union”) and for the issuance of evidence of the same:

         Type of account(s) (check all that apply):

                  ❑ share savings            ❑ share checking                    ❑ share certificate
                  ❑ share certificate        ❑money market                       ❑ ATM card
                  ❑ debit card               ❑ other _______________

2.        Specimens of the signatures of those that are authorized to make withdrawals from the account(s) and to
act in connection therewith are indicated below, and Credit Union is authorized to act upon the request of Member
bearing any of such signatures, including, but without limiting the generality of the foregoing, the pledging of this
the account(s) in whole or in part as security for any loan made by Credit Union to Member, until Member receives
written notice of the authorization of others to sign for Member together with specimen signatures of such person
or persons. Credit Union is authorized to supply any endorsement for the Member on any check or other instru-
ment tendered for the account(s) and Credit Union is hereby relived of any liability in connection with collection of
such items which are handled by you without negligence, and Credit Union shall not be liable for the acts of its
agents, subagents or others for any casualty. Withdrawals may not be made on account of such items until collected,
and any amount not collected may be charged back to the account(s), including expenses incurred, and any other
outside expenses incurred relative to the account(s) may be charged to Member.


                                           FOR SOLE PROPRIETOR

Authorized signature of sole proprietor:

____________________________________

____________________________________
(Typed or printed name)
             FOR CORPORATION, LIMITED LIABILITY CORPORATION OR ASSOCIATION

                             ________________________________________ (“Company”)

RESOLVED, that the funds of Company are hereby authorized to be paid into the account(s) identified on all Signature
Cards delivered to _______________ Credit Union (“Credit Union”) by Company, and Credit Union is hereby autho-
rized to pay withdrawals signed in the name of Company by any person whose signature appears below (“signatories”).
Credit Union further is authorized to accept pledges of all or any part of said account(s) as security for any loan made by
it to Company which shall be executed in the name of Company by any of the signatories. Credit Union is authorized to
supply any endorsement for Company and any signatory on any check or other instrument tendered for said account(s)
and it is hereby relieved of any liability in connection with the collection of such items which are handled by Credit
Union without negligence and it shall not be liable for the acts of its agents, subagents or others or for any casualty.
Withdrawals may not be made on account of such items until collected, and any amount not collected may be charged
back to said account(s), including expenses incurred, and any other outside expenses relative to said account(s) may be
charged to Company. The authorized signatories are:

______________________________________                  ________________________________________
(Authorized Signature)                                (Authorized Signature)
______________________________________                  ________________________________________
(Typed or printed name)    (Title)                     (Typed or printed name)     (Title)

______________________________________                  ________________________________________
(Authorized Signature)                                (Authorized Signature)
______________________________________                  ________________________________________
(Typed or printed name)    (Title)                     (Typed or printed name)     (Title)

I certify that I am the duly elected, qualified and acting Secretary or Managing Member as the case may be of the above-
named Company, and that the foregoing is a true and correct copy of a resolution adopted by Company at a regular or
duly called special meeting at which a quorum was present, and that said resolution is recorded in its minutes, and that
Company is authorized to take such action, and that the signatures contained in this document are the true signatures of
the persons authorized to sign as indicated in connection with said account(s).

         This the _______ day of ______________________, 20____.

                                                                        ______________________________
                                                                        Secretary or Managing Member
 [Corporate Seal ]


                                                 FOR PARTNERSHIP

                                     ________________________________________
                                                 Name of Partnership
Signature of all general partners:

By: ______________________________________ By: ________________________________________
     (Authorized Signature)                        (Authorized Signature)
    ______________________________________      _______________________________________
     (Typed or printed name)    (Title)            (Typed or printed name)     (Title)

By: ______________________________________ By: ________________________________________
     (Authorized Signature)                         (Authorized Signature)
   ______________________________________       _______________________________________
     (Typed or printed name)    (Title)            (Typed or printed name)     (Title)
TAB 3
             INSTRUCTIONS FOR BUSINESS ACCOUNT FORMS


C.     Sole Proprietorship Accounts

        An individual who operates an unincorporated business under his own name or
under a trade name is said to be a sole proprietor. Sole proprietors may wish to establish a
business account under the sole proprietor’s name or under the trade name if a trade name
is used by the sole proprietor.

        In addition to the Signature Card, sole proprietors who open business accounts
with a credit union should also execute an Opening Certificate for Sole Proprietorship
Accounts found at Tab 3 herein. The Opening Certificate is relatively self-explanatory.
Credit unions should examine the information provided on the Opening Certificate closely
to ensure that there is no more than one person who owns the business in question. Oth-
erwise, if two or more persons own the business, it is by definition something other than a
sole proprietorship.

         If the sole proprietor is operating his business under a fictitious or trade name, the
credit union should require the sole proprietor to provide a true copy of a fictitious name
certificate issued to the sole proprietor by the Ohio Secretary of State. The Fictitious Name
Certificate should be attached as Exhibit “A” to the Certificate for Opening Sole Proprietor-
ship Accounts. Additionally, if the sole proprietor uses any names other than those identi-
fied in the Certificate for Opening Sole Proprietorship Account, such additional trade or
fictitious names should be identified in Exhibit “B” and attached to the Certificate for Open-
ing Sole Proprietorship Accounts.

        Additional items that a credit union may wish to consider asking for prior to
opening the account may include any licensures or copies of permits that are necessary
for the sole proprietor to conduct his or her business. For example, in the case of a
lawyer who desires to open an account, the credit union may want to ask for a copy of the
attorney’s state license.
                  _____________________ CREDIT UNION: BUSINESS ACCOUNTS

                  CERTIFICATE FOR OPENING SOLE PROPRIETOR ACCOUNT


                                                                                 Date: ______________________

Name of sole proprietor: _________________________________________________________ (“Sole Proprietor”)

Trade or fictitious name used: ____________________________________________ (“Trade or Fictitious Name”)

_____________________________________________________________________________________________
       (Address)                            (City)                (State)       (Zip)

Sole Proprietor desires to establish with _____________________________ Credit Union (“Credit Union”) the
following types of business accounts:

                  (check all that apply):
                  ❑ share savings                      ❑ share checking                    ❑ share certificate
                  ❑ share certificate                  ❑ money market                      ❑ ATM card
                  ❑ debit card                         ❑ other _______________

all of which are collectively referred to herein as the “Account”.

In consideration of Credit Union’s acceptance of the Account under the previously designated Trade or Fictitious
Name, Sole Proprietor agrees to protect and indemnity Credit Union against all loss or liability, including court
costs and attorney fees, arising from or growing out of the acceptance by Credit Union for payment or credit of
checks drawn to the order of and indorsed in said Trade or Fictitious Name.

Sole Proprietor hereby certifies as follows:

         1.        Trade or Fictitious Name is used in the conduct of the Sole Proprietor’s unincorporated busi-
ness which is owned entirely by the undersigned as a sole proprietorship. Sole Proprietor has complied with all
applicable state and local laws regarding operation of a business under such Trade or Fictitious Name. Attached
hereto as Exhibit A is a true copy of fictitious name certificate issued to the undersigned by the Ohio Secretary of
State. The undersigned hereby certify that the said Trade or Fictitious Name is a trade name being used in the
conduct of an unincorporated business and that the undersigned does not operate or do business under any other
names, except as identified in Exhibit B attached hereto.

         2.      The persons authorized as signatories for the Account are identified on the signature card(s) for
said Account as delivered by Sole Proprietor to Credit Union from time to time.

        3.       The principal office of the Sole Proprietor to which until further notice all communications
should be addressed is identified above in this Opening Certificate For Sole Proprietor Account.

          4.       Insofar as Credit Union acts as a depository of funds of the Sole Proprietor, Credit Union is
authorized and directed to pay or otherwise honor any checks, notes, drafts, bills of exchange, acceptances, under-
takings, and orders for the payment, withdrawal, or transfer of any such funds when executed in the name of the
Sole Proprietor and signed by Sole Proprietor or any person identified as an authorized signatory on any signature
card(s) delivered by Sole Proprietor to Credit Union from time to time, without inquiry as to circumstances of
issue or disposition of proceeds even if drawn to the individual order or for the individual benefit of the under-
signed or tendered in payment of his or her obligation; and Credit Union is authorized and directed to honor for
deposit or collection any endorsement of the Sole Proprietor upon checks, drafts, notes, bills of exchange, accep-
tances or other instruments whether such endorsement be written or stamped with or without any designation of
the individual making such endorsement.

         5.       Insofar as Credit Union acts as a depository for the securities, documents, or other property of
the Sole Proprietor, Credit Union is authorized and directed to make purchases, deposits, sales, exchanges, with-
drawals, or other disposition of such securities, documents or other property upon and according to written order
signed by Sole Proprietor or any person identified as an authorized signatory on any signature card(s) delivered by
Sole Proprietor to Credit Union from time to time, even though such orders are for the delivery or disposition of
securities, documents or other property to or for the account of or for the individual benefit of the Sole Proprietor;
and Credit Union is authorized to transfer and hold any and all such securities, documents or other property in the
name of Credit Union’s nominee or nominees.

        6.       Any person designated as an authorized signatory on any signature card(s) delivered by Sole
Proprietor to Credit Union from time to time is authorized in the name and on behalf of the by Sole Proprietor
and from time to time:

         (a) to sign, in the name of the by Sole Proprietor checks, notes, drafts, bills of exchange, acceptances,
         undertakings, or other orders for the payment, withdrawal or transfer of money with Credit Union; (b) to
         deposit securities, documents or other property with Credit Union, and from time to time to give orders
         to Credit Union for the purchases, sale, exchange, withdrawal, or other disposition of any or all such
         securities, documents or other property, or the proceeds thereof; (c) to apply for and procure loans and
         advances from Credit Union; (d) to apply for and procure travelers credits, commercial credits, accep-
         tance credits, or other forms of credit or accommodation with or without security; (e) to purchase and/or
         sell, and/or to enter into agreements to purchase and/or sell, foreign exchange, foreign currencies, and
         dollar drafts from, to, or through Credit Union; (f) to negotiate or discount commercial paper, negotiable
         instruments, bills receivable, bills of exchange, and dollar drafts, with or through Credit Union; (g) to
         purchase and/or sell from, to or through Credit Union stocks, bonds, and other securities; (h) to pledge,
         hypothecate, sell, assign, and transfer as security (or as additional or substitute security) for the repayment
         of any loans, advances, and credits, procured by the by Sole Proprietor from Credit Union and for the
         performance of the obligations (direct or contingent, due or to become due) of the by Sole Proprietor to
         Credit Union any and all of the right, title, and interest of the by Sole Proprietor in and to any accounts,
         deposits, stocks, bonds, securities, negotiable instruments, receivables, bills of lading, shipping documents,
         warehouse receipts, trust receipts, documents of title, insurance certificates, invoices, chattel paper, gen-
         eral intangibles, and other property of property rights of any kind; (i) to make, execute, and deliver such
         notes, undertakings, drafts, bills of exchange, acceptances, trust receipts, documents, indorsements, as-
         signments, transfers, orders, authorizations, stock powers, proxies, waivers, acquittances, releases, pledges,
         and hypothecations in the premises in such forms as may be prescribed by or satisfactory to Credit Union;
         and (j) to take such steps, do such acts and make and provide for such payments in the premises as may
         appear necessary or appropriate in order to carry out and perform the obligations (at or before maturity) of
         the by Sole Proprietor to Credit Union.

         7.       Sole Proprietor authorizes and requests Credit Union to pay and charge to the Account all checks,
obligations, and orders for the payment of money drawn on or payable at, or that shall be paid or honored by Credit
Union’s financial institution when so signed, whether payable to the order of any of the authorized signatories for
the Account or not; and also authorize and request Credit Union to receive deposits and conduct the Account in
accordance with the instructions stated previously, and as stated on the authorized signature card(s) filed with
Credit Union by Sole Proprietor from time to time.

         8.      If any other persons become interested in said business as copartners of the undersigned or if the
business should become incorporated the undersigned will notify Credit Union promptly.

                                                                 SOLE PROPRIETOR:

                                                                 ___________________________________
                                                                 Signature
                                                                 Typed Name: ________________________

State of ____________________
County of __________________, ss:

        On _____________, ____, 20___ before me personally appeared _______________ known to me to be a
member of the partnership of ____________________ described in and who executed the foregoing instrument
and acknowledged execution of the same, for and in behalf of said partnership.

                                                                 ___________________________________
                                                                 Notary Signature
Commission expires: ______________________
             Exhibit A
Copy of Fictitious Name Certificate
                             Exhibit B
List of All Other Trade or Fictitious Names Used by Sole Proprietor
TAB 4
             INSTRUCTIONS FOR BUSINESS ACCOUNT FORMS


D.     Partnership Accounts

         A general partnership is essentially an unincorporated business association consist-
ing of two or more entities who act as co-owners of the business. The partners share in the
profits and losses of the partnership. The partnerships may be general or limited in nature.
The creation of partnerships and the relationships among the partners are governed by state
law. In general partnerships, all of the partners will share in the management of the busi-
ness of the partnership as well as the profits and losses. Each of the general partners has the
ability to bind the entire partnership by that partners actions or conduct on behalf of the
partnership. On the other hand, a limited partnership consists of both one or more general
partners and one or more limited partners. The general partners manage the day to day
affairs of the partnership and have the authority to bind and obligate the partnership, whereas
the limited partners are almost always passive investors in the partnership. Limited part-
ners do not have the power to bind and obligate the partnership through their actions and
conduct. Likewise, limited partners are limited for liability purposes only to the extent of
their investment in the partnership.

        In addition to the Signature Card, a Certificate for Opening Partnership Account,
found at Tab 4 herein, should be completed for both general partnerships and limited part-
nerships. The name of the partnership should be indicated on the first line of the Certifi-
cate of Opening. The trade name being used by the partnership, if different than the part-
nership name, should also be identified.

        For limited partnerships, a copy of the partnership agreement should be attached as
Exhibit A to the Certificate of Opening. In addition to the Partnership Agreement, a copy
of the fictitious name filing certificate filed with the Ohio Secretary of State should be
attached as Exhibit B. Often times, the limited partnership forms and other associated
documents filed with the Ohio Secretary of State’s Office can be found at the Ohio Secre-
tary of State’s website at http://www.state.oh.us/sos.

         Line 4 of the Certificate of Opening asks for the names of all of the general partners
who are authorized to transact business with respect to the partnership account(s). The list
of all general partners should be attached as Exhibit C to the Certificate of Opening. Line
5 ascertains whether any of the general partners are corporations or limited liability corpo-
rations. In such a case, these corporate partners will need to provide a resolution in a form
substantially the same as Exhibit D to the Certificate for Opening Partnership Account. If
there is more than one corporate partner, a separate resolution should be executed by each
of the partners. In the case of multiple resolutions, it is helpful to identify them success-
fully as Exhibits D-1, Exhibit D-2, etc.
All of the general partners must sign the signature page to the Certificate for Opening
Partnership Account. The form of Certificate for Opening Partnership Account provides
enough space for five (5) general partners to sign. If there are additional general partners,
please add a signature space for each additional partner. Remember that in the case of a
limited partnership, only the general partners need to sign the signature page. If there is a
question as to who is general partner of the limited partnership, it will be helpful to refer to
the partnership agreement being provided by the partnership as Exhibit “A”.
                        ____________ CREDIT UNION: BUSINESS ACCOUNTS

                      CERTIFICATE FOR OPENING PARTNERSHIP ACCOUNT

                                                                                  Date: ______________________

Name of Partnership: _______________________________________________________________ (“Partnership”)
Trade name, if different than Partnership name: _______________________________________________________

       The undersigned desire to establish with _____________________________ Credit Union (“Credit
Union”) the following types of business accounts:

                  (check all that apply):
                  ❑ share savings                      ❑ share checking                    ❑ share certificate
                  ❑ share certificate                  ❑ money market                      ❑ ATM card
                  ❑ debit card                         ❑ other _______________

all of which are collectively referred to herein as the “Account”.

        In consideration thereof and other financial accommodations (including the opening and/or mainte-
nance of the Account or any other accounts or services) as Credit Union may furnish to the Partnership, the
undersigned hereby represent to Credit Union and agree with Credit Union as follows:

1.       The Partnership is organized and operated as a:

                  (check one)        ❑ general partnership      ❑ limited partnership

2.       If Partnership is a limited partnership, a true and correct copy of the partnership agreement is attached
         hereto as Exhibit A.

3.       The Partnership is operated under the fictitious name of ____________________ and has complied with
         all applicable state and local laws regarding operation of a business under such fictitious name. Attached
         hereto as Exhibit B is a true copy of fictitious name certificate issued to the Partnership by the Ohio
         Secretary of State. The undersigned hereby certify that the said fictitious name is a trade name being used
         in the conduct of an unincorporated business and that the Partnership does not operate or do business
         under any other names.

4.       The names of all general partners and of the partners authorized to transact business in the Account are
         set forth in Exhibit C attached hereto.

5.        (check one)
          ❑ All of the general partners of the Partnership are natural persons.
          ❑ One or more of the general partners of the Partnership is a corporation or limited liability company
              (collectively referred to herein as a “business entity partner”).
•    Each business entity partner has attached as Exhibit D hereto a resolution certified by an officer setting forth
     that entity’s authority to establish the Account. If there is more than one business entity partner of the
     Partnership, the resolutions shall be identified as Exhibit D-1, Exhibit D-2, etc., as appropriate.

6.       The entities authorized as signatories for the Accounts are identified on the Signature Card for the Ac-
         counts and are incorporated herein by reference as if fully set forth herein.

7.       The principal office of the Partnership to which until further notice all communications should be ad-
         dressed


______________________________________________________________________________________
       (Address)                           (City)                (State)       (Zip)
8.    Insofar as Credit Union acts as a depository of funds of the Partnership, Credit Union is authorized
      and directed to pay or otherwise honor any checks, notes, drafts, bills of exchange, acceptances,
      undertakings, and orders for the payment, withdrawal, or transfer of any such funds when executed
      in the name of the Partnership and signed by any general partner designated previously, without
      inquiry as to circumstances of issue or disposition of proceeds even if drawn to the individual order
      or for the individual benefit of any signing partner or tendered in payment of his or her obligation;
      and Credit Union is authorized and directed to honor for deposit or collection any endorsement of
      the Partnership upon checks, drafts, notes, bills of exchange, acceptances or other instruments whether
      such endorsement be written or stamped with or without any designation of the individual making
      such endorsement.

9.    Insofar as Credit Union acts as a depository for the securities, documents, or other property of the
      Partnership, Credit Union is authorized and directed to make purchases, deposits, sales, exchanges,
      withdrawals, or other disposition of such securities, documents or other property upon and accord-
      ing to written order signed by any general partner designated above, even though such orders are for
      the delivery or disposition of securities, documents or other property to or for the account of or for
      the individual benefit of the signing partner; and Credit Union is authorized to transfer and hold any
      and all such securities, documents or other property in the name of Credit Union’s nominee or
      nominees.

10.   Any general partner who designated as an authorized signatory on the Signature Card delivered to
      Credit Union by the Partnership is authorized in the name and on behalf of the Partnership and from
      time to time:

      (1) to sign, in the name of the Partnership checks, notes, drafts, bills of exchange, acceptances, under-
      takings, or other orders for the payment, withdrawal or transfer of money with Credit Union; (2) to
      deposit securities, documents or other property with Credit Union, and from time to time to give
      orders to Credit Union for the purchases, sale, exchange, withdrawal, or other disposition of any or
      all such securities, documents or other property, or the proceeds thereof; (3) to apply for and procure
      loans and advances from Credit Union; (4) to apply for and procure travelers credits, commercial
      credits, acceptance credits, or other forms of credit or accommodation with or without security; (5)
      to purchase and/or sell, and/or to enter into agreements to purchase and/or sell, foreign exchange,
      foreign currencies, and dollar drafts from, to, or through Credit Union; To negotiate or discount
      commercial paper, negotiable instruments, bills receivable, bills of exchange, and dollar drafts, with
      or through Credit Union; (6) to purchase and/or sell from, to or through Credit Union stocks,
      bonds, and other securities; (7) to pledge, hypothecate, sell, assign, and transfer as security (or as
      additional or substitute security) for the repayment of any loans, advances, and credits, procured by
      the Partnership from Credit Union and for the performance of the obligations (direct or contingent,
      due or to become due) of the Partnership to Credit Union any and all of the right, title, and interest
      of the Partnership in and to any accounts, deposits, stocks, bonds, securities, negotiable instruments,
      receivables, bills of lading, shipping documents, warehouse receipts, trust receipts, documents of
      title, insurance certificates, invoices, chattel paper, general intangibles, and other property of prop-
      erty rights of any kind; (8) to make, execute, and deliver such notes, undertakings, drafts, bills of
      exchange, acceptances, trust receipts, documents, indorsements, assignments, transfers, orders, au-
      thorizations, stock powers, proxies, waivers, acquittances, releases, pledges, and hypothecations in
      the premises in such forms as may be prescribed by or satisfactory to Credit Union; and (9) to take
      such steps, do such acts and make and provide for such payments in the premises as may appear
      necessary or appropriate in order to carry out and perform the obligations (at or before maturity) of
      the Partnership to Credit Union.

11.   The undersigned, being all of the partners in the case of a general partnership, or in the case of a
      limited partnership the undersigned being the authorized general partner, severally agree for the
      Partnership and for ourselves and our respective legal representatives that Credit Union may con-
      sider said Partnership as continuing for all purposes, and that Credit Union may consider each of the
      undersigned as continuing as a partner, until Credit Union shall have received written notice to the
      contrary, signed by at least one of the partners or his legal representatives; and that all signatures,
      indorsements, and instructions in the Partnership name, or on behalf of the Partnership, by any of
      said partners, which shall be honored by Credit Union prior to the receipt by Credit Union of such
      written notice, shall be in all respects valid and binding upon said Partnership and each of us.
12.       The undersigned authorize and request Credit Union to pay and charge to the Account all checks,
          obligations, and orders for the payment of money drawn on or payable at, or that shall be paid or
          honored by Credit Union’s financial institution when so signed, whether payable to the order of any
          of the authorized signatories for the Account or not; and also authorize and request Credit Union to
          receive deposits and conduct the Account in accordance with the instructions stated previously, and
          as stated on the authorized Signature Card filed with Credit Union by the undersigned.

13.       If any other person or persons become interested in the Partnership as a copartner or if the relations
          of the partners of the Partnership are hereafter altered in any way or if the business of the Partnership
          should become incorporated, the undersigned will notify Credit Union promptly.




If Partnership is a general partnership, then
include signatures of all general partners:

(1)       ___________________________________________
          Printed Name: _______________________________
          Title: General Partner

(2)       ___________________________________________
          Printed Name: _______________________________
          Title: General Partner

(3)       ___________________________________________
          Printed Name: _______________________________
          Title: General Partner

(4)       ___________________________________________
          Printed Name: _______________________________
          Title: General Partner

(5)       ___________________________________________
          Printed Name: _______________________________
          Title: General Partner


If Partnership is a limited partnership, then
include signatures of all the general partners
authorized by the partnership agreement

(1)       ___________________________________________
          Printed Name: _______________________________
          Title: General Partner

(2)       ___________________________________________
          Printed Name: _______________________________
          Title: General Partner

(3)       ___________________________________________
          Printed Name: _______________________________
          Title: General Partner
          Exhibit A
Copy of Partnership Agreement
            Exhibit B
Copy of Fictitious Name Certificate
                                                 Exhibit C

                          Names of All General Partners of the Partnership


         The following are the names of all general partners (with the name of any general partner who is a
natural person less than 18 years old identified as being less than 18 years of age) of the Partnership. These
partners who are authorized to transact business in the Account are shown with a check in the box along side
his or her name:


                         ___________________________________________              ❑



                         ___________________________________________              ❑



                         ___________________________________________              ❑



                         ___________________________________________              ❑



                         ___________________________________________              ❑



                         ___________________________________________              ❑



                         ___________________________________________              ❑



                         ___________________________________________              ❑
                                                Exhibit D -___

                                CERTIFIED COPY OF RESOLUTION
                                          (Partnership)

              ________________________________________________________________
                                         Name of Entity
                                       (the “Company”)

The undersigned hereby certifies that he/she is the duly elected, qualified and acting Secretary or Managing
Member as the case may be of the Company named above, which Company is organized and existing under
the laws of the State of ______________.

The undersigned further certifies that Company is a general partner of the partnership known as
________________________________________ (the “Partnership”), having a business address of
__________________________, ____________________________, ___________, _______, and Company
is authorized under its charter, by-laws and all applicable laws to own a general partnership interest in the
Partnership and act on the Partnership’s behalf as a general partner.

The undersigned further certifies that the following is a true and accurate copy of a resolution unanimously
adopted at a meeting of the Board of Directors of said Company duly called and held at its offices on
______________ ____, 20__, at which meeting a quorum was present and voting throughout.

        “RESOLVED, that ________________________________________________ Credit Union, of
        _____________________, _____________, (“Credit Union”) be and it hereby is designated a de-
        pository in which the funds of the Partnership may, from time to time, subject to the rules, regula-
        tions and by-laws of the Credit Union, be deposited by any of the authorized signatories identified
        on the Signature Card on file with Credit Union for the Partnership and as to all deposit and other
        accounts maintained by the Partnership at Credit Union (“Authorized Signatories”). The Autho-
        rized Signatories are hereby authorized to act for the Company as a general partner for the Partner-
        ship and in the Partnership’s name to endorse for deposit with Credit Union, whether in demand or
        time accounts, or for negotiation or collection, any and all checks, drafts, notes, certificates of deposit
        or other instruments or orders for the payment of money payable to the Partnership, which endorse-
        ment may be in writing, by stamp, or otherwise, with or without designation or signature of the
        person so endorsing, it being understood that on all such items all prior endorsements are guaranteed
        by the Partnership and the Company as a general partner thereof, irrespective of the lack of an ex-
        press guarantee in the endorsement of the Partnership or the Company.

        FURTHER RESOLVED, that Credit Union is hereby authorized and directed to recognize any of
        the signatures of Authorized Signatories for the payment of funds from the Partnership’s deposit
        accounts with Credit Union and for the transaction of any and all business of the Partnership with
        said Credit Union.

        FURTHER RESOLVED, that Credit Union is hereby authorized and directed to honor and pay and
        charge to the accounts of the Partnership any checks, drafts, notes or other orders for payment,
        withdrawal or transfer of funds or money deposited in the account or to the credit of the Partnership
        and any instructions regarding the same, and any authorizations for the transfer of funds between
        different accounts of the Partnership, whether oral, by phone or electronic means without inquiry as
        to the circumstances related thereto and for whatever purpose or to whomever payable, including
        requests for conversion of the same into cash as well as for deduction from and payment of cash out
        of any deposit, and whether or not payable to, endorsed or negotiated by or for the credit of any
        person signing the same or any other general partner, agent or employee of the Partnership, when
        signed, accepted, endorsed or approved as evidenced by original or facsimile signature by any of the
        Authorized Signatories.

        FURTHER RESOLVED, that Credit Union be and is hereby authorized to comply with any
        process, summons, order, injunction, execution, distraint, levy, lien, or notice of any kind (herein-
        after called “Process”) received by or served upon Credit Union, which in Credit Union’s opinion
        affects any and all of the Partnership’s deposit accounts with Credit Union, and Credit Union may,
        at its option and without liability, thereupon refuse to honor orders to pay or withdraw sums from
        any and all of the Partnership’s deposit accounts and may either hold the balance therein until
        Process is disposed of to Credit Union’s satisfaction, or to pay the balance over to the source of the
        Process.

        FURTHER RESOLVED, that the Company assumes full responsibility and holds harmless the
        Credit Union for any and all payments made or any other actions taken by Credit Union in
        reliance upon the signatures, including facsimiles thereof, of any Authorized Signatory, regardless
        of whether or not the facsimile signature was unlawful or unauthorized and regardless of by whom
        or by what means the purported signature or facsimile signature may have been affixed to the
        instrument if such signatures reasonably resemble the specimen or facsimile signatures as provided
        to Credit Union, or for refusing to honor any signatures not provided to Credit Union, and that
        the Company agrees to indemnify Credit Union against any and all claims, demands, losses, costs,
        damages or expenses suffered or incurred by Credit Union resulting from or arising out of any
        such payment or other action.

        FURTHER RESOLVED, this resolution shall continue in full force and effect until written notice of
        revocation has been duly received by Credit Union and Credit Union has had reasonable opportu-
        nity to act thereon.

        FURTHER RESOLVED, the Secretary or Managing Member of the Company, as the case may be, is
        hereby authorized and directed from time to time to add to or remove one or more persons who are
        Authorized Signatories to the Partnership’s Signature Card on file with Credit Union, and Credit
        Union shall be entitled to rely upon such statement until it receives a later statement of such person
        or persons changing such names.”

The undersigned further certifies that there is no provision in the Company’s Articles of Incorporation or
Management Agreement as the case may be, as amended to date, or the by-laws of the Company limiting the
power of the Board of Directors or the Members as the case may be to pass the foregoing resolution and that
the same is in conformity with the provisions of said Articles of Incorporation or Management Agreement
and the Company’s By-laws.

Given under my hand as Secretary of said Company and under its corporate seal this _______ day of
______________________, 20____.


                                                                ____________________________________
                                                                     Secretary

[Corporate Seal]




To Be Signed by an Officer Other Than the Person Certifying the Resolution:

I, ______________________, __________________ of said Company, do hereby certify that
   (Name)           (Officer’s Title)
the foregoing is a correct copy of resolution adopted as above set forth.


                                                              ____________________________________
                                                              Name: ______________________________
                                                              Title: _______________________________
TAB 5
             INSTRUCTIONS FOR BUSINESS ACCOUNT FORMS


E.     Corporations, Limited Liability Corporations and Unincorporated Associations

       In addition to the Business Account Signature Card, corporations, limited liability
corporations and unincorporated associations (collectively referred to in these instruction
as “organizations”) should have executed a resolution authorizing the entity to open and
maintain with the credit union the business accounts identified on the Signature Card.
The Certified Copy of Resolution that is found at Tab 5 herein, is a resolution authorizing
an organization to open and maintain an account at the credit union.

       For corporations and unincorporated associations, the secretary of such organiza-
tion should execute and certify that the copy of the resolutions contained in the Certified
Copy of Resolution are true and accurate. For a limited liability corporation, the managing
member should provide such certification. On page 2 of the Certified Copy of Resolution,
the credit union should ensure that corporations and associations desiring to open accounts
have identified the officers of the corporation or association by name and title.

        Depending upon the type of organization involved, certain exhibits should be at-
tached to the Certified Copy of Resolution. If the entity is a corporation, Exhibit A to the
Certified Copy of Resolution should be a copy of the articles of incorporation and all amend-
ments thereto. A corporation should be able to provide this with little effort, however,
copies may be obtained from the Ohio Secretary of State if necessary.

        If the organization is a limited liability corporation, then the managing member
should attach as Exhibit A to the Certified Copy of Resolution a copy of the articles of
organization and all amendments thereto for the limited liability corporation. In addition,
a limited liability corporation should attach a true and correct copy of the organization’s
management agreement and all amendments thereto as Exhibit “B” to the Certified Copy
of Resolution.

        In the event that the organization is an unincorporated association, then the secre-
tary of such association should attach a true and correct copy of its articles of association as
Exhibit “C” to the Certified Copy of Resolution. An unincorporated association may in-
clude entities such as a club, a fraternal organization, a religious society, a lodge, or another
form of unincorporated organization or a non-profit corporation.

        In the event that the entity is not incorporated or otherwise organized under Ohio
law, the secretary or managing member of the organization should obtain a certificate of
good standing from the Ohio Secretary of State indicating that the organization has taken
all steps required under Ohio law to conduct or carry on the enterprise of the organization
in Ohio. The certificate of good standing should be attached to the Certified Copy of
Resolution as Exhibit “D”.
                             CERTIFIED COPY OF RESOLUTION
           (Corporate and Limited Liability Corporation or Unincorporated Association)

                ________________________________________________________________
                                           Name of Entity
                                         (the “Company”)

The undersigned hereby certifies that he/she is the duly elected, qualified and acting Secretary or Managing
Member of the Company named above, which Company is organized and existing under the laws of the State of
______________, and that the following is a true and accurate copy of a resolution unanimously adopted at a
meeting of the Board of Directors of said Company duly called and held at its offices on ______________ ____,
20__, at which meeting a quorum was present and voting throughout:

        “RESOLVED, that ________________________________________________ Credit Union, of
        _____________________, _____________ (“Credit Union”) be and it hereby is designated a depository
        in which the funds of the Company may, from time to time, subject to the rules, regulations and by-laws
        of the Credit Union, be deposited by any of its officers, agents or employees; and that any officer, agent
        or employee of this Company is hereby authorized on behalf of the Company and in its name to endorse
        for deposit with Credit Union, whether in demand or time accounts, or for negotiation or collection,
        any and all checks, drafts, notes, certificates of deposit or other instruments or orders for the payment of
        money payable to the Company, which endorsement may be in writing, by stamp, or otherwise, with or
        without designation or signature of the person so endorsing, it being understood that on all such items
        all prior endorsements are guaranteed by the Company, irrespective of the lack of an express guarantee in
        the endorsement of the Company.

        FURTHER RESOLVED, that Credit Union is hereby authorized and directed to recognize any of the
        signatures of the officers of the Company whose names appear on any signature card(s) delivered by the
        Company to Credit Union from time to time for the payment of funds from the Company’s deposit
        accounts with Credit Union and for the transaction of any and all business with said Credit Union.

        FURTHER RESOLVED, that Credit Union is hereby authorized and directed to honor and pay and
        charge to the accounts of the Company any checks, drafts, notes or other orders for payment, withdrawal
        or transfer of funds or money deposited in the account or to the credit of the Company and any instruc-
        tions regarding the same, and any authorizations for the transfer of funds between different accounts of
        the Company, whether oral, by phone or electronic means without inquiry as to the circumstances
        related thereto and for whatever purpose or to whomever payable, including requests for conversion of
        the same into cash as well as for deduction from and payment of cash out of any deposit, and whether or
        not payable to, endorsed or negotiated by or for the credit of any person signing the same or any other
        officer, agent or employee of the Company, when signed, accepted, endorsed or approved as evidenced
        by original or facsimile signature by any of the officers of the Company whose names appear on any
        signature card(s) delivered by the Company to Credit Union from time to time.

        FURTHER RESOLVED, that Credit Union be and is hereby authorized to comply with any process,
        summons, order, injunction, execution, distraint, levy, lien, or notice of any kind (hereinafter called
        “Process”) received by or served upon Credit Union, which in Credit Union’s opinion affects any and
        all of the Company’s deposit accounts with Credit Union, and Credit Union may, at its option and
        without liability, thereupon refuse to honor orders to pay or withdraw sums from any and all of the
        Company’s deposit accounts and may either hold the balance therein until Process is disposes of to
        Credit Union’s satisfaction, or to pay the balance over to the source of the Process.

        FURTHER RESOLVED, that the Company assumes full responsibility and holds harmless Credit Union
        for any and all payments made or any other actions taken by Credit Union in reliance upon the signa-
        tures, including facsimiles thereof, of any person or persons identified as an authorized signatory on any
        signature card(s) delivered by the Company to Credit Union from time to time, regardless of whether or
         not the facsimile signature was unlawful or unauthorized and regardless of by whom or by what means
         the purported signature or facsimile signature may have been affixed to the instrument if such signatures
         reasonably resemble the specimen or facsimile signatures as provided to Credit Union, or for refusing to
         honor any signatures not provided to Credit Union, and that the Company agrees to indemnify Credit
         Union against any and all claims, demands, losses, costs, damages or expenses suffered or incurred by
         Credit Union resulting from or arising out of any such payment or other action.

         FURTHER RESOLVED, this resolution shall continue in full force and effect until written notice of
         revocation has been duly received by Credit Union and Credit Union has had reasonable opportunity to
         act thereon.

         FURTHER RESOLVED, the Secretary, any Assistant Secretary or the Managing Member as the case
         may be is hereby authorized and directed from time to time to furnish Credit Union statements of the
         names of the then officers of the Company who are authorized to act under this resolution or any other
         resolution and Credit Union shall be entitled to rely upon such statement until it receives a later state-
         ment of such person or persons changing such names.”

The undersigned further certifies that there is no provision in the Articles of Incorporation, as amended to date,
or the Management Agreement, as amended to date, or the by-laws of the Company limiting the power of the
Board of Directors to pass the foregoing resolution and that the same is in conformity with the provisions of said
Articles of Incorporation, Management Agreement and By-laws.

If Company is a corporation or association, then the undersigned further certifies that the following are the
names of the present officers of said Company:

                     Name                                        Title
                     _______________________                     _______________________
                     _______________________                     _______________________
                     _______________________                     _______________________
                     _______________________                     _______________________
                     _______________________                     _______________________

If Company is a corporation, then the undersigned further certifies that a true and correct copy of the articles of
incorporation and all amendments thereto for the Company are attached hereto as Exhibit A, or if Company is a
limited liability corporation, then the undersigned certifies that a true and correct copy of the articles of organiza-
tion and all amendments thereto for the Company are attached hereto as Exhibit A.

If Company is a limited liability corporation, then the undersigned further certifies that a true and correct copy of
the management agreement and all amendments thereto for the Company are attached hereto as Exhibit B.

If the Company is an unincorporated association under Ohio law, then the undersigned further certifies a true
and correct copy of its Articles of Association are attached hereto as Exhibit C. In the event that the Company is
not incorporated or otherwise organized under Ohio law, then a certificate of good standing to conduct or carry
on the enterprise of the Company in Ohio is attached hereto as Exhibit D.

Given under my hand this _____ day of ______________________, 20___.

                                                                    ______________________________________
                                                                 Secretary or Managing Member (as applicable)
 [Corporate Seal ]

To Be Signed by an Officer or Member Other Than the Person Certifying the Resolution:

I, ______________________, __________________ of said Company, do hereby certify that
   (Name)                        (Title)
the foregoing is a correct copy of resolution adopted as above set forth.
                                                                         ______________________________
                                                                         Name: ________________________
                                                                         Title: _________________________
                   Exhibit A

Copy of Article of Incorporation or Organization
          Exhibit B

Copy of Management Agreement
                              Exhibit C

Copy of Articles of Association an a Current Good Standing Certificate
             Exhibit D

Copy of Certificate of Good Standing
             INSTRUCTIONS FOR BUSINESS ACCOUNT FORMS


F.     Limited Powers Of Attorney

        In certain circumstances, sole proprietors and partnerships may wish to allow addi-
tional persons to act on behalf of their accounts with the credit union. In such cases, credit
union may agree to accept a limited power of attorney naming the additional party that is
authorized to act on behalf of the account. Tabs 6 and 7 contain forms that may be used as
limited powers of attorney for both sole proprietorships and partnerships.

         The information required for the limited powers of attorney forms are self-explana-
tory, but it is helpful to note that the name of the person to be appointed as the attorney-in-
fact for the sole proprietorship or partnership should be clearly identified by name on the
first page of the limited power of attorney along with the person’s full address. Addition-
ally, the signature of the attorney-in-fact should be included on the limited power of attor-
ney as a specimen signature. The limited power of attorney form should be signed by the
sole proprietor or by an authorized partner in the case of a partnership. In either case, the
signature should be notarized.


       Credit unions may wish to include copies of such limited powers of attorney along
with their signature card records so that credit union personnel will be able to readily iden-
tify whether the authorized signature of the attorney-in-fact comports with that listed on
the limited power of attorney form.
TAB 6
              LIMITED POWER OF ATTORNEY TO ACT FOR SOLE PROPRIETOR
                        WITH RESPECT TO DEPOSIT ACCOUNTS WITH
              _______________________________ CREDIT UNION (“CREDIT UNION”)


         KNOW ALL MEN BY THESE PRESENTS, that I, __________________________, having an ad-
dress        at         ____________________________________________________________,
________________________________, ______________, and doing business as an unincorporated business
owned      entirely     by     me    and      operated     under the name      and     style    of
_______________________________________________ (“Trade Name”), have made, constituted and ap-
pointed and by these presents do make, constitute and appoint

                                    ____________________________________
                                    (Name of attorney-in-fact)
                                    ____________________________________
                                    (Address)
                                    ____________________________________
                                    (City)             (State)   (Zip)

my true and lawful attorney-in-fact from time to time and in my name, place and stead:

         1.       To make, draw, sign, accept, endorse, deposit, deliver checks, drafts and other
                  instruments for the payment of money; to sign receipts for cancelled checks and
                          vouchers;

         2.       To acknowledge the correctness of any statement of any account;

         3.       To accept and receive notice and demands;

         4.       To open, deposit in, operate, withdraw from and close deposit accounts; and generally to do
                  all acts and things with reference to any deposit account of ours now or hereafter with
                  Credit Union, giving and granting unto my attorney full power and authority to do and
                  perform all and every act and thing whatsoever in connection with the foregoing, as fully to
                  all intents and purposes as I might and could do if personally present; and

         5.       Each and every power herein conferred upon said attorney-in-fact, in the name of the un-
                  dersigned either to perform any act or to execute, seal, and deliver any negotiable instru-
                  ment or other document is also hereby conferred on said attorney-in-fact to do and perform
                  the same in the Trade Name under which the undersigned is conducting business as a sole
                  proprietor.

          We hereby authorize and direct Credit Union to receive, accept, pay, and/or apply without limit as to
amount, without inquiry and without regard to the application thereof or the proceeds thereof, any draft,
check or instrument for the payment of money, drawn by our attorney-in-fact on or made payable by our
attorney-in-fact from any account or accounts, including drafts, checks or instruments for the payment of
money payable or endorsed to the order of our attorney-in-fact (or any one of our attorneys-in-fact) or pay-
able or endorsed in any other manner, which may be deposited with, or delivered or transferred to Credit
Union, or otherwise for the personal credit or account of, or in payment of the individual obligation of our
attorney-in-fact (or any one of our attorneys-in-fact) to Credit Union or others. We hereby ratify and confirm
all previous acts of our attorney-in-fact with the same force and effects as if such acts had been done after the
execution and delivery of this Power of Attorney.

          To induce Credit Union, at its option in each instance, to act in reliance hereon, we hereby agree,
jointly and severally and on behalf of the partnership, that the authority contained herein shall not be affected
by any dissolution, termination, or change in the membership of the partnership (whether by death or resig-
nation of any partner, or otherwise) or any modification or termination of the powers of any partner, but shall
be and continue in full force and effect and binding upon the partners jointly and severally and upon the heirs,
executors, administrators, and distributes of each partner, and upon the partnership and its successors, unless
and until revoked or modified by written notice duly signed, actually received by you, provided that such
notice shall not affect any action taken in reliance hereon prior to the receipt thereof and shall not, in any
event, be effective until you have had a reasonable time to act thereon after its receipt. The following is a
specimen of the signature of the attorney-in-fact appointed hereby:


                                                               _____________________________
                                                               Signature of Attorney-in-Fact


         IN WITNESS WHEREOF I have caused this power of attorney to be duly executed this ________
day of ___________________, 20____.


                                                               __________________________________
                                                               Typed Name: _______________________


State of ____________________

County of __________________, ss:

        On _____________, ____, 20___ before me personally appeared _______________ known to me to
be a member of the partnership of ____________________ described in and who executed the foregoing
instrument and acknowledged execution of the same, for and in behalf of said partnership.



                                                               ___________________________________
                                                               Notary Signature
Commission expires: ______________________
TAB 7
                  LIMITED POWER OF ATTORNEY TO ACT FOR PARTNERSHIP
                 WITH RESPECT TO PARTNERSHIP DEPOSIT ACCOUNTS WITH
                _____________________________ CREDIT UNION (“CREDIT UNION”)

        KNOW ALL MEN BY THESE PRESENTS, that we, a partnership, known as ______________________,
_____________________________ having a place of business at _____________________________________,
_________________________, ______________ have made, constituted and appointed and by these presents do
make, constitute and appoint

                                    ____________________________________
                                    (Name of attorney-in-fact)
                                    ____________________________________
                                    (Address)
                                    ____________________________________
                                    (City)             (State)   (Zip)

our true and lawful attorney-in-fact for us from time to time and in the name, place and stead of us, the under-
signed partnership:

         1.       To make, draw, sign, accept, endorse, deposit, deliver checks, drafts and other
                  instruments for the payment of money; to sign receipts for cancelled checks and
                  vouchers;

         2.       To acknowledge the correctness of any statement of any account;

         3.       To accept and receive notice and demands; and

         4.       To open, deposit in, operate, withdraw from and close deposit accounts; and generally to do all
                  acts and things with reference to any deposit account of ours now or hereafter with Credit Union,
                  giving and granting unto our attorney full power and authority to do and perform all and every
                  act and thing whatsoever in connection with the foregoing, as fully to all intents and purposes as
                  any partner of the undersigned might and could do if personally present.

          We hereby authorize and direct Credit Union to receive, accept, pay, and/or apply without limit as to
amount, without inquiry and without regard to the application thereof or the proceeds thereof, any draft, check or
instrument for the payment of money, drawn by our attorney-in-fact on or made payable by our attorney-in-fact
from any account or accounts, including drafts, checks or instruments for the payment of money payable or en-
dorsed to the order of our attorney-in-fact (or any one of our attorneys-in-fact) or payable or endorsed in any other
manner, which may be deposited with, or delivered or transferred to Credit Union, or otherwise for the personal
credit or account of, or in payment of the individual obligation of our attorney-in-fact (or any one of our attorneys-
in-fact) to Credit Union or others. We hereby ratify and confirm all previous acts of our attorney-in-fact with the
same force and effects as if such acts had been done after the execution and delivery of this Power of Attorney.

          To induce Credit Union, at its option in each instance, to act in reliance hereon, we hereby agree, jointly
and severally and on behalf of the partnership, that the authority contained herein shall not be affected by any
dissolution, termination, or change in the membership of the partnership (whether by death or resignation of any
partner, or otherwise) or any modification or termination of the powers of any partner, but shall be and continue in
full force and effect and binding upon the partners jointly and severally and upon the heirs, executors, administra-
tors, and distributes of each partner, and upon the partnership and its successors, unless and until revoked or
modified by written notice duly signed, actually received by you, provided that such notice shall not affect any
action taken in reliance hereon prior to the receipt thereof and shall not, in any event, be effective until you have
had a reasonable time to act thereon after its receipt. The following is a specimen of the signature of the attorney-
in-fact appointed hereby:
                                                        _____________________________
                                                        Signature of Attorney-in-Fact


         IN WITNESS WHEREOF we have caused this power of attorney to be duly executed this ________
day of ___________________, 20____.


                                                        __________________________________
                                                        (Name of Partnership)

                                                        By: _______________________________
                                                                Signature of Partner

                                                        Typed Name: _______________________


State of ____________________

County of __________________, ss:

        On _____________, ____, 20___ before me personally appeared _______________ known to me to
be a member of the partnership of ____________________ described in and who executed the foregoing
instrument and acknowledged execution of the same, for and in behalf of said partnership.



                                                        ___________________________________
                                                        Notary Signature
Commission expires: ______________________
         Section VI:
Pricing of Business
Checking Accounts
                           SECTION VI:
                     PRICING STRATEGIES FOR
                  BUSINESS CHECKING ACCOUNTS

Overview

The operational functions and details of running business deposit services (processing, statement
delivery, opening account process, etc.) are vitally important, and each element must be consid-
ered carefully to ensure proper internal controls and efficient methods are employed. All of these
elements are critically important to the credit union. In the members’ eyes however, they
generally don’t care about these credit union back-office operations.

Nothing is more important than the pricing, convenience and service a typical business owner
receives. For the vast majority of credit unions, these elements will be their niche into attracting
business accounts. Your competitors (banks and thrifts) have offered business accounts for many
decades, and they have the “processing” function down to a science, but their big profit motives
certainly leave the doors open for credit unions to compete on price and service. As banks and
thrifts have merged and consolidated over the past 15 years, many small business/SOHO mem-
bers have been left to the pricing wolves as the conglomerates court the high profit, large business
accounts. There are exceptions, particularly among the smaller community banks.

Credit unions serving the business needs of their members will quickly realize the huge variety of
businesses willing to be served…along with the needs (and personalities) of their member/
owners! Some business owners are keen to every little charge on their statements, while others
care less whether they are charged a monthly account fee…as long as the service and convenience
are worth the price. Time is a very valuable commodity to most business owners and factors
such as service, convenience, and promptness to error resolutions are highly cherished, even
more so than price in many instances.


Strategies in Pricing the Business Account

This section to the Member Business Account Guide will examine the strategies in pricing, prima-
rily among the checking product. It will not present an exact pricing plan, as pricing is contingent
upon a wide array of variables, including:

     ➤ Local Competition: This will probably affect the pricing structure more than any other
       element. Business account pricing is different from community to community, city to
       rural area and large bank to small bank/thrift. National and statewide statistics are inher-
       ently less meaningful if the credit union’s own local competition is not thoroughly
       investigated.

     ➤ Sophistication of Financial Institution: Over the years, financial institutions have “ana-
       lyzed” business accounts, meaning that through the use of more sophisticated software,
       they have the ability to price according to how “profitable” the account is to its bottom


Ohio Credit Union Business Checking Account Guide                                                6-1
          line. Usual items “analyzed” include balances held, compensating balances held in other
          accounts, and total service fees generated in a monthly cycle.

     ➤ Packaging of Services: To entice a business customer/member to utilize additional
       services, fees and minimum balances are many times reduced or waived based upon the
       usage of various other services (loans, merchant processing, insurance products, payroll
       processing, etc).



What pricing philosophy makes sense for most credit unions entering the
member business account arena?

Generally, the more sophisticated and larger the business enterprise, the greater the need for the
credit union to potentially invest in software that will permit it to “analyze” account relationships
more thoroughly and to increase flexibility. For most credit unions that will be primarily target-
ing the SOHO/small business relationships, complicated/sophisticated pricing is usually not
necessary. In fact, most would agree that a credit union’s greatest strength is to send a “simple”
pricing message to its potential business account owners. Credit unions are well positioned to be
able to portray the message that says, “Hey business owner…we can offer you a lower price on
your business accounts and offer you the personal service we are known for” (as compared to the
bank who has a reputation of gouging the small business owner, along with an impersonal, profit-
oriented image). Our pricing is straightforward without long lists of fees that inevitably “nickel
and dime” you to death.”


Pricing Issues

Several issues come to bear when pricing business accounts. Each is briefly discussed below:

     1. Paying Dividends on Business Checking Accounts
          Credit unions enjoy a distinct advantage over banks and thrifts. Banks and thrifts are still
          subject to a Depression-era law that prohibits the payment of interest on checking
          accounts. (Banks and thrifts are limited to paying interest on checking accounts only to
          individuals and to “religious, philanthropic, charitable, and educational” types of ac-
          counts). The interest ban was enacted as part of the Banking Act of 1933 to protect small
          community banks from engaging in a bidding war for customers. Although many
          attempts to remove this ban have occurred over the past decade (including several in
          2001), proposed legislation has not been successful.

          Many large banks and financial firms have actually lobbied against lifting the ban, citing
          increased costs. Other reasons include: 1) financial conglomerates have been able to
          corner the market for cash management services, and 2) large banks can offer business
          customers ways to get around the checking account interest ban by “sweeping” money
          out of checking and into a money market account overnight. These sweep accounts are
          generally costly and cumbersome for banks and therefore are usually only offered to large
          businesses that can maintain high minimum balances (i.e. $25,000). Small businesses
          usually cannot afford the higher costs and do not have the time or resources to manage


Ohio Credit Union Business Checking Account Guide                                                  6-2
          these accounts, according to small-business organizations who have lobbied to lift the ban
          on interest checking.

          Credit unions, on the other hand, have been able to pay dividends on business and
          organizational checking accounts for over two decades. When the Monetary Control Act
          of 1980 was drafted, CUNA was able to include language to Section 205 (f)(2) (now part
          of the Federal Credit Union Act), permitting credit unions to pay dividends on business
          and organizational checking accounts.

          The ability to pay dividends on checking affords a distinct advantage for credit unions.
          Generally, small businesses are not seeking sophisticated sweep accounts or accounts with
          complex pricing structures with multiple fees that typically result in higher average cost
          accounts found at banks. The payment of dividends allows credit unions to structure their
          pricing in a simple, easy-to-understand, and lower cost format. The necessity for offering
          sometimes complicated and expensive account analysis services to the small business owner is
          greatly reduced...enhancing the attractiveness of a credit union’s simple, easy to understand
          account structure and terms.

     2. Relationship Pricing
          Every credit union understands the concept and importance of establishing “financial
          relationships” with members, attracting a larger portion of an individual’s financial needs
          through good cross-selling techniques and by packaging these services to benefit those
          who contribute most to the bottom-line. As credit unions investigate their local competi-
          tion for business pricing schedules, a wide variety of relationship pricing packages will be
          found. Whenever possible, credit unions should attempt to use this strategy. Business
          owners (especially) are generally looking for means to “uncomplicate” their lives and
          establishing relationships that can meet most of their business financial needs in one easy
          location.

          Among banks, relationship pricing is found in a multitude of combinations. Fees,
          minimum balances and other charges are waived or lowered based on various other
          account relationships or account usage, including: total deposits in other accounts
          (money market accounts, certificates, savings); credit card usage; financial products
          (retirement account management, financial planning services, insurance products);
          payroll services; merchant credit card processing; and personal accounts with the same
          financial institution.

          Although most credit unions do not generally have the vast array of product offerings that
          large banks may offer presently, credit unions should not be deterred from offering
          business accounts. Credit unions entering the business market cannot attract all business
          owners’ needs initially. Product knowledge and expansion of services will grow as
          experience is gained over time.

     3. Don’t Give the Service Away
          To date, many credit unions have priced their business checking accounts close to their
          personal checking account, not fully contemplating the true cost of processing and
          servicing the business account. Business accounts vary widely in terms of costs incurred,
          depending on the business type. For example, the number of deposits and the number of


Ohio Credit Union Business Checking Account Guide                                                   6-3
          return items will vary drastically between a grocery store and the local Cub Scout troop
          operating fund account.

          Credit unions are many times in the position to try to undercut some of the local
          competition’s pricing, but not at the expense of losing money in the process. As with
          other product offerings, credit unions must always analyze its cost of delivering these
          services. To assist, the article “Knowing When the Price is Right” is included at the end
          of this section.

     4. Research the Local Market Competition
          Pricing schematics can vary widely depending upon where your credit union is located.
          Although some limited national and state data averages are currently available, the com-
          plexity of account structures and relationship pricing make the data less meaningful in
          terms of actual use in establishing an individual credit union’s specific pricing plan.

          National Business checking fees and structures were reported in the PSI/Global/CUNA
          & Affiliates’ The SOHO Market – Growth and Potential Report. The data is summa-
          rized in CUNA’s 2002 Fees Survey Report and is included at the end of this section.

          It is imperative that each credit union investigates its own market and competition in
          deciding its own specific pricing strategy and what various account structures will be
          offered to meet the needs of its members’ businesses. As stated earlier, this Guide cannot
          identify a pricing strategy that will work for all credit unions, however, it will review
          some of the major components of the typical pricing schematics found among most
          financial institutions. This should assist in each credit union’s own research.

          Your credit union may wish to identify at least five local competitors and either visit or
          call the financial institution. Ask for a copy of their business account terms and fees.
          Most institutions will gladly and readily provide a copy, much like your credit union
          would provide a Truth-in-Savings (TIS) disclosure to a potential member (just don’t
          identify yourself as representing the credit union!). Keep in mind, however, accounts for
          business purposes are not subject to TIS, so the timing and content of delivered disclo-
          sures may not follow TIS requirements.

     5. Don’t Let the Tail Wag the Dog
          There is a seemingly infinite variety of businesses and business owners. Don’t let each
          business owner dictate the account terms to the credit union. Your credit union cannot
          be everything to everybody. Instead, listen carefully to the overall needs of your member-
          business owners and adjust the pricing and account structures as needed to accommodate
          most of their needs. For most credit unions, two or three different checking account
          products should suffice.



Typical Business Account Fees

The following is a list of typical business account checking fees charged by financial institutions.
Do not consider this list all-inclusive. Your credit union may or may not wish to charge fees in


Ohio Credit Union Business Checking Account Guide                                                 6-4
all these areas. You may find that area competitors are charging a fee that is not listed below. The
bolded items are generally considered “primary” fees, and are highlighted in the various pricing
comparisons in the attached charts at the end of this section.

     ➤ Monthly Service Fee
     ➤ Minimum Balance
     ➤ Fee if Minimum Balance Requirement Not Met
     ➤ Excess Debits & Credits
     ➤ Overdraft Fee From Loan or Savings
     ➤ Dividends
     ➤ ACH Debit/Credit Fees Per Item
     ➤ Mid-month Statement Fee
     ➤ Coin & Currency Delivery
     ➤ Coin Handling
     ➤ Early Account Closure Fee (i.e. within 180 days)
     ➤ Legal Processing (attachments, garnishments, tax levies, etc.)
     ➤ NSF Fee Per Item
     ➤ Photocopy of Check
     ➤ Research/Checkbook Balancing (per hour fee)
     ➤ Returned Deposited Item
     ➤ Re-deposit of Returned Item
     ➤ ATM Transaction Fees
     ➤ Credit/Debit Card Replacement
     ➤ Wire Transfers (Domestic, International, Incoming)
     ➤ Replacement of Lost Night Depository Zipper Bag or Locked Bag/Key
     ➤ Quarterly Sales Tax Reporting Assistance
     ➤ Stop Payment



Sample Pricing Strategy/Process

A chart developed by OCUS staff is located at the end of this section, outlining a typical strategy
by which many financial institutions establish business checking services. Various (i.e. three)
checking account “plans” are established to best serve the many different needs of businesses,
some with high transaction volume, some with low volume. Excess per item or other charges are
incurred once the business account exceeds certain volume levels, encouraging the business
owner to consider the next higher level of checking plan. Fees are reduced and/or dividends are
paid for businesses that can maintain higher minimum balance levels.

Transaction volume will have a direct bearing on the expenses incurred by the credit union – data
processing, statements, staff time, returned items, number of deposits, etc. Whereas a typical
non-business account will have an average of 20-25 transactions per month, a business account


Ohio Credit Union Business Checking Account Guide                                                6-5
may have hundreds or thousands of items per month for processing. Pricing “per item” on
business accounts is almost imperative to ensure revenues generated are high enough to cover
expenses. At the same time, some small business enterprises may have very few transactions (i.e.
less than 10 per month) and your plan should be able to accommodate these accounts without
incurring overly excessive fees.

A sample of various credit union business checking account pricing features, prepared by
CUNA’s Business/SEGs Services Committee, is included at the end of this section. This is an
excellent example of the type of comparison process that your credit union may wish to consider
in researching the local competition. This can sometimes prove to be a bit challenging, as pricing
plans are not necessarily structured alike, and variables such as relationship pricing discussed
above come into play. Obtaining local financial institutions’ business account rate and fee sched-
ules is imperative. A blank pricing comparison chart is included to help you get started!

A sample “Credit Union Business Account Rate And Fee Schedule” is attached, along with two
bank business account pricing schedules (obtained in the Columbus market). You will note that
although some of the bank fees may appear exorbitantly high, one must recognize that banks have
had established business relationships a very long time. They fully understand the added costs
involved in maintaining business account relationships, and their pricing reflects these costs plus
their added profit motive.

Finally, credit unions should easily find areas where they can undercut the pricing levels of banks
and thrifts, particularly in the small business/SOHO market. Credit unions may find this task a
little harder at times with some smaller community banks that offer more competitive pricing
levels.


Conclusion

Pricing of business accounts is not an exact science. In order for credit unions to be successful in
their business community, it is imperative that credit unions understand their local competition
and establish a thorough and comprehensive strategy to compete on their business account
offerings. Credit unions must also recognize (and research) the additional costs incurred in
delivering these services to ensure their pricing is adequate to cover expenses and low enough to
attract business relationships. While pricing is important, your credit union’s real niche will lie in
the personal service and convenience provided to the business owner.




Ohio Credit Union Business Checking Account Guide                                                  6-6
                      Sample Pricing Strategy for
                   Member Business Checking Accounts

                        Small Business          Business Plus         Executive Business
                          Checking                Checking                Checking
           Ideal for    Up to 50 total debit   51-500 total debit &    More than 500 total
    businesses with:    & credit items per      credit items per       debit & credit items
                              month                 month              per month: or those
                                                                      holding larger balances


Monthly Service Fee             $10                   $15                     None


 Minimum Balance               $250                  $2,500                  $25,000


 Fee if Balance Falls
  Below Minimum                 $10                   $25                     $100
Balance during month


    Excess Debit            30¢ each               15¢ each                 15¢ each
     & Credits            over 50 items          over 50 items            over 50 items


Overdraft Fee From              $20                   $20                      $20
 Loan or Savings


     Dividends                 None                 Balance:                 Balance:
                                                 $2,500 & over           $2,500-$25,000
                                                  90 Day T-Bill           90 Day T-Bill
                                                 (adj. quarterly)        (adj. quarterly)

                                                                        $25,001-$50,000
                                                                             + ¼%

                                                                         $50,001 & over
                                                                             + ½%
T E C H N I C A L LY           M I N D E D ,       P E O P L E       D R I V E N
                                                         760 Kinnear Road
                                                         Columbus, Ohio 43212
                                                         Phone: 614-298-6421
                                                                  800-233-6880
                                                         Fax:     614-298-6468
                                                         E-mail:  K_Lykens@bmifcu.org




                     Business Packages
                     Business Checking

Business Checking
BMI Federal Credit Union’s Business Checking plan is designed for small
businesses with basic checking and deposit needs. It operates like a personal
account in your business’ name. Our Business Checking is a simple,
straightforward account structured to meet all of your business checking
requirements.
      •   $50.00 minimum opening deposit
      •   Monthly Service Fee
          — $10.00 monthly service fee when your average daily balance is
            <$3,000.
          — $6.00 monthly service fee when your average daily balance is
            >$3,000 but <$10,000
          — No monthly service fee for average daily balances in excess of
            $10,000
      •   $0.05 will be charged for each debit and credit to the account
      •   Maintenance fees may be offset through a Monthly Earnings Credit. This
          earnings credit is calculated on your average daily collected balance.
      •   Cancelled checks will be safe kept by BMI Federal Credit Union,
          however you will have complete access to view your cancelled checks
          via the internet
      •   Receive up to 2 Visa Debit cards, with your company name, free of
          charge. The Visa Debit card will give you access to your account 24
          hours a day. Your first 6 transactions, every month, at an ATM, are free,
          additional transactions will incur a $0.75 fee per transaction.
      •   Night Depository service w/locking deposit bag available
T E C H N I C A L LY           M I N D E D ,       P E O P L E       D R I V E N
                                                         760 Kinnear Road
                                                         Columbus, Ohio 43212
                                                         Phone: 614-298-6421
                                                                  800-233-6880
                                                         Fax:     614-298-6468
                                                         E-mail:  K_Lykens@bmifcu.org




                  Business Packages
                Business Plus Checking


Business Plus Checking
At BMI Federal Credit Union a competitive interest rate can be earned on your
checking account. Larger balance accounts should consider our interest bearing
checking account. Don’t let the type of business you have or the number of checks
you write limit your ability to earn interest on your money.
      •   $50.00 minimum opening deposit
      •   A flat monthly service fee of $20.00
      •   Balances in excess of $8,000 earn interest
      •   Tiered Dividend rate:
          — Balances <=$50,000 earn dividends at the Fed Funds rate minus 50
            basis points
          — Balances >$50,000 earn dividends at the Fed Fund rate
      •   $0.07 will be charged for each debit and credit to the account
      •   Your account will be debited or credited, separately, each month to
          reflect both fees charged and interest earned.
      •   Cancelled checks will be safe kept by BMI Federal Credit Union, how-
          ever you will have complete access to view your cancelled checks via
          the internet
      •   Receive up to 2 Visa Debit cards, with your company name, free of
          charge. The Visa Debit card will give you access to your account 24
          hours a day. Your first 6 transactions, every month, at an ATM, are free,
          additional transactions will incur a $0.75 fee per transaction
        Section VII:
  Regulatory Issues/
 Policies and Share
Insurance Coverage
                         SECTION VII:
                  REGULATORY ISSUES, POLICIES
                AND SHARE INSURANCE COVERAGE


Risk Management/Liability Issues

     ➤ Deposits of Business Checks
          Credit unions are cautioned that any practice of depositing business checks into personal
          accounts subjects the credit union to potential losses under the Uniform Commercial
          Code (UCC). Policies should state that a check that is made payable to a business or
          organization may only be deposited to an account in the name of the business or organi-
          zation (including sole proprietor businesses). Certain exceptions could apply with
          management approval, with full assurances that all endorsements are legal, the intent of
          the parties are genuine and fully authorized by the company or organization.


          The UCC states that a financial institution:

               •    May be determined to have had notice of a breach of fiduciary duty when they
                    permit an employee of a business to deposit a business check made payable to the
                    credit union into a personal account or uses a business check to pay a personal
                    loan.

               •    May also be liable if a company employee takes a check payable to the company,
                    endorses it on behalf of the company, and then deposits the check into his or her
                    personal account or uses it to pay a personal loan.


     ➤ Kiting
          According to CUMIS, business accounts are subject to increased potential of kiting
          activity. Since many business owners experience pressures relating to cash flow, kiting
          activity is overall more prevalent and potential losses from kiting can be much higher
          than compared to consumer accounts.

          More information on kiting detection is available from CUNA Mutual Insurance Group
          at 800-637-2676, and the Ohio Credit Union League’s Research & Information depart-
          ment at 800-486-2917.




Ohio Credit Union Business Checking Account Guide                                                   7-1
Regulatory Disclosures

A few regulatory requirements that apply to individual member accounts, do not apply to busi-
ness accounts. Below is a review of the major rules applying to credit union accounts, and if
business accounts are treated differently.

     ➤ Truth-in-Savings (TIS): All federal and state chartered credit unions are subject to
       NCUA Rules and Regulations on TIS. Section 707.2 (q) excludes TIS coverage on
       accounts that “do not include a natural person who holds an account for another in a
       professional capacity or an unincorporated nonbusiness association of natural person
       members.”

          NCUA defines account coverage for members by a consumer-versus-business purpose
          account distinction. The term “member” includes persons holding an account primarily
          for personal, family, or household (consumer) purposes. An account held for another in
          a professional capacity, would not be covered. The following accounts are not covered
          under the TIS rule (affecting opening account disclosures, periodic statements and APY
          disclosures):

               •    Club accounts (i.e. bowling, investment, etc.).

               •    Business accounts, including sole proprietor accounts (because such accounts
                    are held for a business purpose).

               •    Accounts of natural persons who, in their professional capacity, hold the account
                    for another (for example, attorney-client trust accounts and trust accounts
                    opened by a trustee as a result of a formal written trust agreement).

               •    Nondeposit type accounts, such as mortgage escrow accounts, construction loan
                    accounts, discount brokerage accounts, and overdraft line of credit accounts.

                    Note: While club and business accounts are not covered, credit unions may find it
                    easier in some cases (particularly club accounts) to include these as covered
                    accounts rather than maintaining two sets of disclosures and procedures.

               •    Funds Availability (Regulation CC): Both consumer and business accounts are
                    covered under the Expedited Funds Availability Act. Those opening checking
                    accounts must receive funds availability disclosures. For reference, see Section
                    229.2 (n) of Regulation CC.

               •    Electronic Funds Transfer (Regulation E): EFT regulations/disclosures only apply
                    to consumer-type accounts. Business accounts are not covered by Regulation E
                    requirements. Regardless, many credit unions provide EFT disclosures to
                    businesses upon account opening and on periodic statements as with consumer
                    accounts.




Ohio Credit Union Business Checking Account Guide                                                  7-2
Share Insurance Coverage

     ➤ NCUSIF
          Accounts owned by corporations, partnerships, or unincorporated associations that are
          qualified members of the credit union are insured separately through the National Credit
          Union Share Insurance Fund (NCUSIF). The funds owned by the business or associa-
          tion in the credit union are aggregated and insured up to $100,000. In order to have
          separate insurance coverage, however, the account must not be set up merely to expand
          insurance coverage – that is, the business must be engaged in an activity independent of
          individual members who may be owners of the business. If the business structure is
          viewed as merely existing to expand insurance coverage, the funds in the accounts will be
          considered to be owned by the individuals and aggregated with other personal funds.


          The following are examples of insurance coverage for business/association accounts:


               EXAMPLE 1


               Q. Member Clara is operating a small business but has not incorporated. She opens
                  up an account and fills out the account card as “Clara,” doing business as “Clara,
                  the Professional Clown.” Will this account be insured separately?


               A. No. This account will not receive separate insurance coverage, but rather will be
                  combined with all other individual accounts owned by Clara for purposes of
                  calculating insurance.



               EXAMPLE 2


               Q. The president of a corporation holds $75,000 of the company’s funds at WYZ
                  Credit Union. She also has a $60,000 joint share certificate account with her
                  husband at XYZ. What is the insurance coverage for these accounts?


               A. The accounts are separately insured up to $100,000. Since each is under the
                  maximum insurance limit, they are fully insured.



               EXAMPLE 3


               Q. The women’s club at the local church holds fund-raising activities and wants to
                  open a share account and deposit $19,000 funds in the credit union sponsored by
                  the church. The church also relies on the credit union and may have at times




Ohio Credit Union Business Checking Account Guide                                                 7-3
                    upwards of $100,000 in share draft and certificate accounts at the credit union.
                    Does the women’s club have to worry that its funds will not be fully insured if
                    the church’s deposits at the credit union exceed $81,000?


               A. The women’s club is an unincorporated association and its deposits in the credit
                  union will be separately insured. Therefore, the club can receive up to $100,000
                  share insurance coverage for any deposits it makes in the credit union.



                    * Source: NCUA Share Insurance Fund (NCUSIF) Regulations; CUNA
                    RegTrac (Level 2, NCUA Manual).


➤ ASI
          Businesses and organizations that are qualified members of the credit union receive
          primary share insurance coverage in the same capacity as do individual member accounts
          with American Share Insurance (ASI) coverage. Each account held by the business is
          insured up to a maximum of $250,000 (versus NCUSIF’s maximum of $100,000 per
          business relationship).

          Excess Share Insurance (ESI) is optional coverage provided to qualifying federal credit
          unions. Participating federal credit unions may add up to an additional $250,000 to their
          current member deposit insurance coverage, thus increasing their coverage from
          $100,000 of federal protection to $350,000 of combined federal and private coverage.

          The following are examples of ASI insurance coverage for business and association
          accounts:

               EXAMPLE 1


               Q. The credit union’s sponsor company is a member of XYZ Credit Union with ASI
                  primary coverage. They currently hold $125,000 in a checking account, $175,000
                  in a saving account, and $200,000 in a share certificate account. Are all the
                  accounts fully insured?


               A. Yes. All accounts are fully insured through ASI’s primary insurance coverage.
                  Each account receives up to $250,000 in coverage.



               EXAMPLE 2


               Q. Dave’s Brewery, Inc. is a member of ABC Credit Union with ASI primary
                  coverage. The company has $150,000 in a checking account and $400,000 in a
                  share certificate. Are all the accounts fully insured?


Ohio Credit Union Business Checking Account Guide                                                      7-4
               A. No. The checking account would be fully covered in the amount of $150,000.
                  However, only $250,000 of the $400,000 share certificate would be covered,
                  leaving $150,000 uninsured.



               EXAMPLE 3


               Q. Paul’s Egg Hatchery is a member of We Care Federal Credit Union with ASI’s
                  ESI coverage. The company holds $50,000 in checking, and $300,000 in savings.
                  Are all the accounts fully insured?
               A. Yes. NCUSIF would provide full insurance coverage for the $50,000 checking
                  account and the first $50,000 in savings for a maximum insurance coverage of
                  $100,000 by the NCUSIF. ESI would provide the additional $250,000 insurance
                  coverage on the savings account, fully insuring the company’s deposits.




Ohio Credit Union Business Checking Account Guide                                              7-5
Section VIII:
  Resources
              SECTION VIII:
 ADDITIONAL BUSINESS ACCOUNT RESOURCES

The following is a list of additional business service resources (depository and lending) available
to assist your credit union in the development of your own business services strategy, including
policies, procedures, training opportunities, research, pricing, support services, and more.


     ➤ TowerGroup Research Reports
          Review comprehensive research reports on the small business/SOHO markets at
          www.cuna.org/data/cu/research/tg_reports.html or call CUNA’s customer service depart-
          ment at 800-356-8010.


     ➤ Filene Research Institute Report - “Small Business: The New Frontier.”
          Identifies and quantifies credit union business service opportunities; discusses regulatory
          issues, general guidelines for serving the small business market; and examines the widely
          varying strategies used by five credit unions meeting the financial needs of small firms,
          along with models for credit unions to design appropriate strategies. To order, go to
          www.filene.org.


     ➤ CUNA’s Business/SEG Service Center
          Contains research, sample lending and deposit forms, job descriptions, vendor informa-
          tion, regulations, board policies, and other valuable information a credit union may find
          useful as they look to begin or improve their product offerings to small businesses. Go to
          www.cuna.org and click “Business/SEG Services Center.”


     ➤ Ohio Credit Union System
          The Ohio Credit Union League and OCUL Services Corporation can assist affiliated credit
          unions with a wide array of business services needs: training, compliance and regulatory
          information, data, consultation, strategic planning, and more. For more information, go to
          www.ohiocreditunions.org/mbs.htm or contact OCUS at 800-486-2917.


     ➤ Credit Union Executives Society
          Credit Union Executives Society (CUES) offers a host of instructional and training
          opportunities relating to business services, including seminars and CEO networking
          sessions. In June 2002, CUES released its comprehensive business lending manual:
          “Member Business Lending: The New Frontier.” A case for offering business services is also
          reviewed. For more information, go to www.cues.org or call 1-800-252-2664.




Ohio Credit Union Business Checking Account Guide                                                  8-1
     ➤ Corporate One Federal Credit Union
          In addition to providing credit unions with account agreement templates and instructions
          (included), Corporate One is improving its product lineup to cater to credit unions that
          serve businesses. These include new products and enhancements to existing products,
          including Business Debit Card program, web-based ACH origination, Access Daily
          Deposit Services (ADDS), and Share Draft Processing products. Corporate One’s staff
          includes a number of experienced business bankers who may be able to help your credit
          union or chapter develop a successful member business initiative.

          For more about Corporate One’s member business enablement program, contact Mike
          Paton or Leah Rinehart at 1-866-MyCorp1, or go to www.corpone.org.



     ➤ CUNA Mutual Insurance Group
          For more information on employee benefits or other insurance related products, contact
          your CUNA Mutual Account Relationship Representative at 800-333-2644.




Ohio Credit Union Business Checking Account Guide                                              8-2

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:7
posted:7/25/2011
language:English
pages:108