Community Association Banking · May 01, 2023

How a Reserve Account Can Help Your HOA

Your community association often needs to cover immediate expenses like insurance premiums, minor repairs or the costs of strategic investments. Setting up reserve accounts can be a secure way to grow those funds while retaining maximum liquidity.

Here are four criteria your associations should look for when considering reserve accounts.


1 Security

Governing documents or a financial policy may require FDIC insurance or a government-backed or other insured product with no risk to the principal investment. Security is an absolute priority and should be considered nonnegotiable when looking at financial products.

2 Liquidity

While most community associations make long-term plans for larger investments in properties, they may also need funds at any moment. Because emergencies or unexpected situations can arise without warning, be sure your associations can access reserve funds with relative ease.

3 Rate

A product that offers a steady, reliable rate of return is a must for ensuring association asset growth. This growth could provide the maximum funds possible to maintain and enhance property values.

4 Efficiency

Choose a banking partner that can efficiently and effectively offer the services that best fit your community associations.

With those four characteristics in mind, there are a number of HOA bank services that can accommodate HOA financial and investment needs.

HOA bank services options

Money Markets

Money Market accounts are a great way to fund projects that are going to happen on a short timeline. Funds are secure and gain steady interest while remaining accessible.

ICS®

ICS®, the IntraFi® Cash Service, can secure large deposits while maintaining access to and earning interest on funds placed into demand deposit accounts and money market deposit accounts. Deposits are eligible for protection above the $250,000 FDIC limit that is backed by the full faith and credit of the US government.

CDARS®

CDARS®, the IntraFi® Certificate of Deposit Account Registry Service®, is a convenient way to access FDIC insurance on CDs above the $250,000 FDIC threshold, earn CD-level rates and directly work with only one financial institution.

CD Ladders

CD Ladders are well-suited for projects that are going to happen in phases since they can be set to mature in 3-month, 6-month, 9-month and 12-month certificates. Customizing the amounts and lengths of multiple CDs can provide rolling access to funds as each term ends. Ladders provide greater fund liquidity and flexibility, all while keeping HOA funds protected. Plus, your associations get the efficiency of working with one bank that provides one summary statement.

Build a relationship with your financial institution

Whatever HOA banking service products work best for your community associations, it's important to work with a financial institution dedicated to effectively managing assets, building relationships and making complex needs simpler.

As a leader in community association banking, we focus on helping you grow your communities—and your business. Explore our deposit and reserve solutions to learn more.

Account openings and credit are subject to bank approval.

Deposit placement through CDARS or ICS is subject to the terms, conditions and disclosures in applicable agreements. Although deposits are placed in increments that do not exceed the FDIC standard maximum deposit insurance amount (SMDIA) at any one destination bank, a depositor's balances at the institution that places deposits may exceed the SMDIA (e.g., before settlement for deposits or after settlement for withdrawals) or be uninsured (if the placing institution is not an insured bank). The depositor must make any necessary arrangements to protect such balances consistent with applicable law and must determine whether placement through CDARS or ICS satisfies any restrictions on its deposits. A list identifying IntraFi network banks appears at https://www.intrafi.com/network-banks. The depositor may exclude banks from eligibility to receive its funds. IntraFi, ICS, CDARS and Certificate of Deposit Account Registry Service are registered service marks of IntraFi Network, LLC. IntraFi Cash Service is a service mark of IntraFi Network, LLC.

CDARS Products:
Term offerings depend on the availability within the IntraFi network. Not all offerings may be available at all times. Rates subject to change. Offer subject to change.

This material is for informational purposes only and is not intended to be an offer, specific investment strategy, recommendation or solicitation to purchase or sell any security or insurance product, and should not be construed as legal, tax or accounting advice. Please consult with your legal or tax advisor regarding the particular facts and circumstances of your situation prior to making any financial decision. While we believe that the information presented is from reliable sources, we do not represent, warrant or guarantee that it is accurate or complete.

Third parties mentioned are not affiliated with First-Citizens Bank & Trust Company.

Links to third-party websites may have a privacy policy different from First Citizens Bank and may provide less security than this website. First Citizens Bank and its affiliates are not responsible for the products, services and content on any third-party website.

Bank deposit products are offered by First Citizens Bank. Member FDIC and an Equal Housing Lender. icon: sys-ehl.

NMLSR ID 503941