In the first place, there are two types of deposit account control agreements: assets and liabilities. The lender should receive a DACA from any third-party bank with which the borrower has a checking account. A custodian bank that signs a DACA agrees to follow the lender`s instructions regarding cash paid by the borrower without further action or agreement from the borrower. Such an agreement gives the lender the “control” of the current account necessary for perfection after the INVESTIGATION PERIOD. Select DACA Services from a reliable and trustworthy financial partner with a dedicated team that will help you create the account and remain accessible throughout the process. Article 9 of the Uniform Commercial Code (UCC) defines a current account as a receivable, time, savings account, savings account or similar account held with a bank. Unlike most types of collateral, filing a UCC-1 financing statement does not perfect a pledge right on a current account. A lender can only perfect a right of pledge on a current account by taking “control” of the account. The establishment of a deposit account control agreement allows lenders to perfect their interest in a debtor`s current accounts (UCC ยง 9-104) and to define who can introduce disposition instructions (transfer instructions) to the bank in respect of the controlled current account(s).

Each custodian bank often has its own form of DACA, although the elements listed above of any form are common. AACs are discussed and negotiated. Therefore, borrowers and lenders should realize that it may take some time before a DACA is agreed and signed by all parties for the lender to benefit from an advanced security interest for a deposit account. Regions has an experienced and centralized deposit account control team, which can offer a number of benefits to lenders and clients as well as their law firms. A lender may establish “control” in one of the following ways: (i) the borrower maintains his or her deposit account directly with the lender; 2. the lender becomes the beneficial owner of the borrower`s deposit accounts with the borrower`s custodian banks; or (3) the lender and borrower enter into a deposit account control agreement (known as DACA) with the borrower`s custodian bank. .