Fund Facts  

Inception Date: Jul 17, 2009
Issuer: Bank of America

Description

Program Overview  

One-, three-, and five-year CD Accounts are issued by Bank of America, N.A. (“Bank”), a member of FDIC, and are available as VantageTrust investment options. CD Account deposits of up to $250,000 are insured by the FDIC, subject to certain limitations. Interest is credited to CD Account balances daily and compounded monthly. Withdrawals prior to the stated maturity date will reduce the annual percentage yield and are generally subject to an early withdrawal penalty (Please see “Withdrawals” below).

At maturity, interest will cease to accrue, and the entire principal amount and all accrued interest will be invested in an investment option selected by your Plan sponsor. If the investment option is the PLUS Fund (or other stable value fund), you should note that direct transfers from the PLUS Fund to CD Accounts and certain other investment options, are prohibited.

Amounts to be invested in CD Accounts are initially held in the Bank’s Money Market Deposit Account (“MMDA”), until the open investment window closes, typically on the second to last business day of the month. Assets held in the MMDA will earn the Bank’s MMDA rate and cannot be withdrawn until after the assets have been invested in the CD Account. At that time early withdrawal penalties could apply. Effective October 28, 2011, the annual administrative fee that ICMA-RC receives for administrative services provided to the 3-year and 5-year VT CD Accounts was reduced from 0.60% to half of the gross rate offered by the Bank, for all new investments. When the gross rates on newly offered 3-year and 5-year VT CD Accounts are equal to or greater than1.20%, the annual administrative fee will again be 0.60%. The annual administrative fee for 1-year VT CD Accounts is 0.60%.

Opening a CD Account: CD Accounts may be funded only through fund-to-fund transfers, and no minimum initial deposit is currently required.

Open Investment Window: Investments will be accepted from the first through the last business day of the open investment window, which will generally run from the last business day of the previous month through the second to last business day of the current month.

Maturity Date: CD Accounts are opened on the first business day following the close of the open investment window, and the maturity date will fall on a future anniversary of that date, based on the term of the CD Account.

Withdrawals: Participants can withdraw assets from a CD Account at any time, but withdrawals prior to the maturity date are subject to an early withdrawal penalty equal to 180 days of interest on the amount withdrawn, unless one of the exceptions identified below applies. The interest penalty is calculated as the gross rate of the CD Account (i.e., the net rate plus the Annual CD Administrative Fee).

Exceptions to the Early Withdrawal Penalty:

• The participant is deceased or disabled.
• The participant is judicially determined to be legally incompetent.
• The participant has separated from service with the Plan sponsor.
• The distribution is for any allowable purchase of permissive service credits.
• The distribution is for any allowable distribution of participant rollover account balances or any age 70½ distributions allowable under the Internal Revenue Code. or
• The distribution is required under a qualified domestic relations order.

Transfer Restrictions: Transfers from the PLUS Fund to CD Accounts are prohibited. Assets must be invested outside of the PLUS Fund in a non-competing fund for a period of 90 days before being transferred to CD Accounts.

FDIC Insurance: ICMA-RC will limit each participant’s aggregate investment in CD accounts to an amount less than $250,000. This limit includes principal, accrued interest, future interest, and any previously purchased VantageTrust CD Accounts issued by Countrywide Bank or MBNA. If an individual’s total investment in CD Accounts exceeds the $250,000 limit, ICMA-RC will transfer the excess amounts to the Plan’s designated maturity fund. Note that ICMA-RC can only limit a participant’s aggregate investment in CD Accounts through Plans administered by ICMA-RC.

 

Footnotes

1.

Please read Making Sound Investment Decisions: A Retirement Investment Guide and the accompanying VantageTrust Fund Fees and Expenses document ("Guide") carefully for a complete summary of all fees, expenses, investment objectives and strategies, and risks before investing. For a current Guide, contact ICMA-RC by calling 800-669-7400 or log into your account at www.icmarc.org.