can penalties be waived for other reasons at the discretion of an institution?
If my memory is correct, there used to be one or two reasons that a bank was required to waive a penalty and death of a depositor was one of them. The wording of the Reg D definition of time deposit now addresses a long list of reasons that the regulation-required penalty may be waived and none of them appears to be mandatory. The institution has always had the option to waive any part of its contractual penalty provision, as long as any mandatory penalty (currently seven days’ interest on the amount withdrawn within six days of deposit or earlier partial withdrawal) is enforced, subject to the option to waive the mandatory penalty in the circumstances listed in footnote 1 to section 204.2.
