A broker establishes a custodial account at a bank. It contains four CDs, each from a different bank. The CDs are all payable to one beneficiary. When the beneficiary wants to withdraw funds from the custodial account, does the custodial bank treat the funds as an aggregate and the transaction as just a transfer of funds from the custodial bank to the beneficiary?
If the funds remain in the form of CD accounts at four separate banks, it's likely that the custodial bank will have to tap each of the four accounts to meet the beneficiary's needs. The timing of the withdrawals would have to be coordinated with the banks holding the actual deposits. For further details on how the custodian would manage the account, contact the custodial bank directly.
BankingQuestions.com is a free service made possible by the generous support of our advertisers. Advertisers are not responsible for site content. Please help us keep BankingQuestions.com FREE by supporting our advertisers. When you see an ad for a product or service you may have an interest in, click through to learn more.
Accounts
Article
Q&A
Podcast
Video
Blog
Discussions
PDF
Powerpoint
If the funds remain in the form of CD accounts at four separate banks, it's likely that the custodial bank will have to tap each of the four accounts to meet the beneficiary's needs. The timing of the withdrawals would have to be coordinated with the banks holding the actual deposits. For further details on how the custodian would manage the account, contact the custodial bank directly.
