Regulation CC Exercises
Everything in this chapter up to this point has had to do with how long you can delay the availability of different types of deposits. If you’ve read the preceding material, now is a good time to test your knowledge. The following questions and answers on deposit availability come from the Federal Reserve Board.
- Your institution is open for all business functions on Saturday.
Customer Jones deposits a $4,000 U.S. Treasury check payable to him
with a teller on Saturday. When must the funds be made available?
- Tuesday. Saturday is not a banking day because it is not a business day, so the deposit is considered to have been received on Monday—the next banking day. Because the funds are from a U.S. Treasury check, they must be made available by the first business day following the day of deposit.
- Customer Martinez deposits a $4,000 certified check payable to her with
a teller at 10 A.M. on Monday. When must the funds be made available?
What if the deposit is made at a proprietary ATM?
- For the deposit made to the teller, the funds must be made
available by Tuesday. The deposit is received on Monday,
and the funds must be made available by the first business
day following the day of deposit.
For the deposit made at the ATM, the first $200 [$225 effective 7/1/20] must be made available by Tuesday, and the remaining $3,800 [$3,775 effective 7/1/20] must be made available by Wednesday. (Certified checks—and most other next-day checks—are considered “second day” items if the deposit is not made in person to one of your employees.)
Note: If the check is deposited at a nonproprietary ATM, the funds must be made available by the following Monday, the fifth business day, and the requirement to make the first $200 [$225 effective 7/1/20] available on the next day does not apply.
- For the deposit made to the teller, the funds must be made
available by Tuesday. The deposit is received on Monday,
and the funds must be made available by the first business
day following the day of deposit.
- Customer Jackson deposits a $400 local check payable to him with a
teller at 10 A.M. on Monday. When must the funds be made available?
- The deposit is considered to have been received on Monday, and the first $200 [$225 effective 7/1/20] must be available by Tuesday. Because the check is a local check, the remaining $200 [$175 effective 7/1/20] must be available by Wednesday, the second business day after the day of deposit.
- Customer Smith deposits a $300 check from her state government payable
to her with a teller at 10 A.M. on Monday. The bank’s availability
disclosure given to Ms. Smith states that a customer must use a
special deposit slip to receive next‑day availability for state and
local government checks; however, Ms. Smith is in a hurry and chooses
not to use the special deposit slip. When must the funds be available?
- Because the special deposit slip was not used, you may treat this item as a local check (assuming that the paying institution is in the same check-processing region as your institution) rather than a next-day check. Therefore, the first $200 [$225 effective 7/1/20] must be available by Tuesday, and the remaining $$100 [$75 effective 7/1/20] should be available by Wednesday.
- Customer Palmer deposits a $10,000 nonlocal check payable to him with a
teller at 10 A.M. on Monday the 1st. When must the funds be made
available?
- The first $200 [$225 effective 7/1/20] must be available by
Tuesday the 2nd. Because the check is nonlocal, the
remaining amount must be available by the fifth business
day, which is Monday the 8th; however, you may choose to
hold the amount over $5,000 [$5,525 effective 7/1/20]
under a “large deposit” exception. If you choose this
option, you must give the customer a hold notice when the
deposit is received (or not later than the close of the
business day on Tuesday if the decision to delay
availability is made after the time of deposit), and you
must provide $200 [$225 effective 7/1/20] by Tuesday the
2nd, an additional $4,800 [$5,300 effective 7/1/20] by
Monday the 8th, and the remaining $5,000 [$4,475 effective
7/1/20] by Tuesday the 16th.
[Remember: Because of the consolidation of Federal Reserve check processing regions, there is no longer any such thing as a nonlocal check.]
- The first $200 [$225 effective 7/1/20] must be available by
Tuesday the 2nd. Because the check is nonlocal, the
remaining amount must be available by the fifth business
day, which is Monday the 8th; however, you may choose to
hold the amount over $5,000 [$5,525 effective 7/1/20]
under a “large deposit” exception. If you choose this
option, you must give the customer a hold notice when the
deposit is received (or not later than the close of the
business day on Tuesday if the decision to delay
availability is made after the time of deposit), and you
must provide $200 [$225 effective 7/1/20] by Tuesday the
2nd, an additional $4,800 [$5,300 effective 7/1/20] by
Monday the 8th, and the remaining $5,000 [$4,475 effective
7/1/20] by Tuesday the 16th.
- Customer Washington deposits a $400 local check payable to her at 3 P.M.
on Monday. The bank’s cut-off hour for the day’s transactions is 2
P.M. When must the funds be available?
- Because the deposit was made after the bank’s cut-off hour, it is considered received on Tuesday. The first $200 [$225 effective 7/1/20] must be made available by Wednesday and the remaining $200 [$175 effective 7/1/20] must be made available by Thursday.