The FDIC has amended an interpretive rule to provide an additional exception to the limitations on premiums that may be given in connection with demand deposits. Section 18(g) of the Federal Deposit Insurance Act (FDI Act) requires that the FDIC by regulation prohibit the payment of interest or dividends on demand deposits. 12 CFR part 329 implements this prohibition. As an exception to the prohibition, an interpretive rule permits premiums of up to $10 for deposits of less than $5000 and up to $20 for deposits of $5000 or more not more than twice per year. The interpretive rule also limits the timing of such premiums to the opening of a new account or an addition to an existing account. The FDIC has amended the interpretive rule to provide an additional exception that permits premiums which are unrelated to the balance in a demand deposit account and the duration of the account balance. Therefore, insured nonmember banks and insured branches of foreign banks are now permitted to give premiums on demand deposits, without limitation as to the amount of the premium, provided that the premiums are not related to, or dependent upon, the balance in the account and the duration of the account balance. This amendment maintains substantial parity with Regulation Q, 12 CFR Part 217, as recently amended by the Board of Governors of the Federal Reserve System (FRB).