Overdraft Protection Changes

March 31,2010

To Our Valued Customers:
Please read about some important changes that may impact you.

In recent years we have provided most of our consumer transaction account customers (including FREE Checking, Regular Checking, Heritage Club Checking, Heritage Plus Checking, Student Checking and Reward Checking) with an overdraft privilege. This service allowed you to be confident that we would normally cover your check or allow a debit to your account when you needed it, even if you did not readily have the funds available to cover the transaction.

Recently, the Federal Reserve Board issued new guidelines for overdraft practices that will provide you with additional flexibility in the management of overdraft practices. Effective July 1, 2010, you must give Texas Heritage Bank specific authorization to allow overdrafts of your account in the event you need it when you use an ATM or use your debit card. There will be no change in the manner in which we handle checks or automatic bill payments. We applaud this change which gives you the option of deciding whether or not your account will automatically overdraw for certain types of transactions.

We have enclosed a form which provides additional information and a place for you to specifically designate how you want us to handle ATM and debit card transactions that may overdraw your account. Please note, effective July 1, 2010 we will no longer be able to overdraw your account automatically if you use your debit/ATM card for an ATM or debit card purchase transaction. If funds are not available to cover the amount of your withdrawal or purchase, the transaction will be declined. However, you may specifically authorize us, by completing and returning the enclosed form, to overdraw your account when necessary.

Please call your local Texas Heritage Bank office if you have questions about this change or the enclosed form.


Steven S. Mack
Chief Executive Officer


Enclosed Forms

Overdrafts and Overdraft Fees