(a) Settlement
through administrative Reserve Bank. A paying bank shall settle
for an item under this subpart with its administrative Reserve Bank,
whether or not the paying bank received the item from that Reserve
Bank. A paying bank’s settlement with its administrative Reserve Bank
is deemed to be settlement with the Reserve Bank from which the paying
bank received the item. A paying bank may settle for an item using
any account on a Reserve Bank’s books by agreement with its administrative
Reserve Bank, any other Reserve Bank holding the settlement account,
and the account holder. The paying bank remains responsible for settlement
if the Reserve Bank holding the settlement account does not, for any
reason, obtain settlement in that account.
9-793.01
(b) Cash items.
(1)
Settlement obligation. On the day a paying
bank receives
2 a cash item from a Reserve Bank, it
shall settle for the item such that the proceeds of the settlement
are available to its administrative Reserve Bank by the close of Fedwire
on that day, or it shall return the item by the later of the close
of its banking day or the close of Fedwire. If the paying bank fails
to settle for or return a cash item in accordance with this paragraph
(b)(1), it is accountable for the amount of the item as of the close
of its banking day or the close of Fedwire on the day it receives
the item, whichever is earlier.
(2) Time of settlement.
(i) On the day a paying bank receives
a cash item from a Reserve Bank, it shall settle for the item so that
the proceeds of the settlement are available to its Administrative
Reserve Bank, or return the item, by the latest of—
(A) The next clock hour or clock half-hour
that is at least one half-hour after the paying bank receives the
item;
(B) 8:30 a.m. eastern time; or
(C) Such later time as provided in the
Reserve Banks’ operating circulars.
(ii) If the paying bank fails to settle
for or return a cash item in accordance with paragraph (b)(2)(i) of
this section, it shall be subject to any applicable overdraft charges.
Settlement under paragraph (b)(2)(i) of this section satisfies the
settlement requirements of paragraph (b)(1) of this section.
9-793.1
(3) Paying bank
closes voluntarily.
(i) If a paying bank closes voluntarily
so that it does not receive a cash item on a day that is a banking
day for a Reserve Bank, and the Reserve Bank makes a cash item available
to the paying bank on that day, the paying bank shall either—
(A) On that day, settle for the item so
that the proceeds of the settlement are available to its Administrative
Reserve Bank, or return the item, by the latest of the next clock
hour or clock half-hour that is at least one half-hour after it ordinarily
would have received the item, 8:30 a.m. eastern time, or such later
time as provided in the Reserve Banks’ operating circulars; or
(B) On the next day that is a banking
day for both the paying bank and the Reserve Bank, settle for the
item so that the proceeds of the settlement are available to its Administrative
Reserve Bank by 8:30 a.m. eastern time on that day or such later time
as provided in the Reserve Banks’ operating circulars; and compensate
the Reserve Bank for the value of the float associated with the item
in accordance with procedures provided in the Reserve Bank’s operating
circular.
(ii)
If a paying bank closes voluntarily so that it does not receive a
cash item on a day that is a banking day for a Reserve Bank, and the
Reserve Bank makes a cash item available to the paying bank on that
day, the paying bank is not considered to have received the item until
its next banking day, but it shall be subject to any applicable overdraft
charges if it fails to settle for or return the item in accordance
with paragraph (b)(3)(i) of this section. The settlement requirements
of paragraphs (b)(1) and (2) of this section do not apply to a paying
bank that settles in accordance with paragraph (b)(3)(i) of this section.
9-793.2
(4) Reserve
Bank closed. If a paying bank receives a cash item from a Reserve
Bank on a banking day that is not a banking day for the Reserve Bank,
the paying bank shall—
(i) Settle for the item so that the proceeds of the settlement are
available to its Administrative Reserve Bank by the close of the Fedwire
Funds Service on the Reserve Bank’s next banking day, or return the
item by midnight of the day it receives the item (if the paying bank
fails to settle for or return a cash item in accordance with this
paragraph (b)(4)(i), it shall become accountable for the amount of
the item as of the close of its banking day on the day it receives
the item); and
(ii) Settle for
the item so that the proceeds of the settlement are available to its
Administrative Reserve Bank by 8:30 a.m. eastern time on the Reserve
Bank’s next banking day or such later time as provided in the Reserve
Bank’s operating circular, or return the item by midnight of the day
it receives the item. If the paying bank fails to settle for or return
a cash item in accordance with this paragraph (b)(4)(ii), it shall
be subject to any applicable overdraft charges. Settlement under this
paragraph (b)(4)(ii) satisfies the settlement requirements of paragraph
(b)(4)(i) of this section.
9-793.3
(5) Manner of settlement. Settlement
with a Reserve Bank under paragraphs (b)(1) through (4) of this section
shall be made by debit to an account on the Reserve Bank’s books or
other form of settlement to which the Reserve Bank agrees, except
that the Reserve Bank may, in its discretion, obtain settlement by
charging the paying bank’s account. A paying bank may not set off
against the amount of a settlement under this section the amount of
a claim with respect to another cash item, cash letter, or other claim
under section 229.34 of this chapter (Regulation CC) or other law.
(6) Notice
in lieu of return. If a cash item is unavailable for return,
the paying bank may send a notice in lieu of return as provided in
section 229.31(f) of this chapter (Regulation CC).
9-794
(c) Noncash items. A Reserve Bank may require
the paying or collecting bank to which it has presented or sent a
noncash item to pay for the item by a debit to an account maintained
or used by the paying or collecting bank on the Reserve Bank’s books
or by any other form of settlement acceptable to the Reserve Bank.
(d) Nonbank payor. A Reserve Bank
may require a nonbank payor to which it has presented an item to pay
for it by debit to an account on the Reserve Bank’s books or other
form of settlement acceptable to the Reserve Bank.
9-795
(e) Liability of Reserve Bank. Except as set
forth in section 229.35(b) of this chapter (Regulation CC), a Reserve
Bank shall not be liable for the failure of a collecting bank, paying
bank, or nonbank payor to pay for an item, or for any loss resulting
from the Reserve Bank’s acceptance of any form of payment other than
cash authorized in paragraphs (b), (c), and (d) of this section. A
Reserve Bank that acts in good faith and exercises ordinary care shall
not be liable for the nonpayment of, or failure to realize upon, any
noncash form of payment that it accepts under paragraphs (b), (c),
and (d) of this section.
