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Federal R eserve Bank OF DALLAS TO NY J . S A L V A G G IO DALLAS. TEXAS 75222 f i r s t V IC E p r e s i d e n t June 21, 1991 Notice 91-51 TO: The Chief Operating Officer of each financial institution in the Eleventh Federal Reserve District SUBJECT New Canadian Check Collection Service DETAILS Beginning July 22, 1991, a Canadian check collection service will be available to all financial institutions in the Eleventh District. We are amending our Bulletin 8 (Collection of Cash Items) to reflect the addition of this new service. As part of the service, the depositing institution will be assessed fees by the Federal Reserve Bank of Dallas and by the Helena Branch of the Federal Reserve Bank of Minneapolis. The fees are as follows: • By the Dallas Federal Reserve Bank - $2.50 per cash letter $.011 (weekdays) and $.008 (weekends) per item transportation surcharge • By the Helena Branch - $2.00 per cash letter $.17 per item $4.50 per return item The deposit deadlines will be 10:00 p.m. Monday through Thursday and noon Saturday in Dallas; 10:00 p.m. Monday through Friday in Houston and San Antonio; and 2:00 p.m. Monday through Friday in El Paso for three-day deferred availability. ATTACHMENT The rules governing this service are contained in the attached Amendment No. 1 to Bulletin 8. Please file the amendment in the appropriate section of your Bulletins binder. For additional copies, bankers and others are encouraged to use one of the following toll-free numbers in contacting the Federal Reserve Bank of Dallas: Dallas Office (800) 333-4460; El Paso Branch Intrastate (800) 592-1631, Interstate (800) 351-1012; Houston Branch Intrastate (800) 392-4162, Interstate (800) 221-0363; San Antonio Branch Intrastate (800) 292-5810. This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) - 2 - MORE INFORMATION If you are interested in using this service, please call Jackie Young, (214) 651-6342, at the Dallas Office; Jane Pyke, (915) 521-8244, at the El Paso Branch; Louis Moore, (713) 652-1581, at the Houston Branch; or Martin Ramsey, (512) 978-1500, at the San Antonio Branch. For additional copies of this B a n k ’s notice, please contact the Public Affairs Department at (214) 651-6289. Sincerely, FEDERAL RESERVE BANK OF DALLAS AMENDMENT NO. 1 TO BULLETIN 8 Collection of Cash Items Effective May 1991, paragraphs 1, 5, 7, 13, 19, and 34 are amended as follows. Paragraph 1 is amended by adding the following language as a second paragraph at the end of the first paragraph: This bulletin, however, is not binding on a bank outside a State1 to which a subsequent collecting bank presents or sends a cash item payable outside a State ("foreign cash item"). For example, paragraphs 23 through 28 regard ing off-premise presentment and payment for cash letters, paragraph 30 regarding differ ences with a paying bank, paragraph 34 regard ing return by a paying bank, and paragraph 38 regarding identification of a returned check are not binding on a paying bank outside a State with respect to a foreign cash item. In addition, the late-return procedure in para graphs 48-50, the rules on notice of nonpay ment in paragraphs 51-63, and the handling of photocopies as cash items in paragraphs 69-73 do not apply to and are not available for foreign cash items. A Reserve Bank may fur ther modify the application of this bulletin to foreign cash items in an agreement with a subsequent collecting bank. Paragraph 5 is amended by deleting the word "and" at the end of subparagraph (b). Paragraph 5 is further amended by deleting the period at the end of subparagraph (c) and replacing it with a semicolon, followed by the word "and." Paragraph 5 is also amended by adding subparagraph (d), which shall read: (d) Demand items payable in Canada, collect ible at par in funds acceptable to the last collecting Reserve Bank, that we are willing to accept as cash items. 1 See footnote 1 in Bulletin 8. Paragraph 7 subparagraph (d) is amended by adding the following language at the end of that paragraph, immediately preceding the semicolon: or if the item is a foreign item; Paragraph 7 is further amended by replacing subparagraph (e) with the following: (e) the item, other than a foreign item, does not state on its face the name and city and state address of the paying bank associated with the routing number on the item; or Paragraph 7 is also amended by deleting the language in subparagraph (f) and substituting: (f) except as provided in paragraphs 69-70 and 76 regarding photocopies, the item does not (i) bear the routing number of the paying bank in fractional form in the upper right corner in at least 8-point Gothic type or (ii) conform to the dimension standards of the American National Standard Specifications for Placement and Location of MICR Printing, X9.13 (September 1983), (between 2 3/4 inches and 3 2/3 inches in width and between 6 inches and 8 3/4 inches in length). We handle such an item as a cash item, however, when we judge that special circumstances justify such han dling or if the item is a foreign item. Paragraph 13 is amended to read: 13. We require that cash items be separately sorted from returned checks, except as other wise provided by written agreement. We re serve the right to require separate sorts of cash items and returned checks and separate sorts of Government checks, postal money or ders, redeemed savings bonds, and food cou pons. We reserve the right to require banks located in the same city, town, metropolitan area, or similar area to sort, list, and pack age cash items payable in the same area ac cording to the office of the paying bank where the items are payable. We reserve the right to require separate sorts of foreign cash items that are payable in U.S. funds and pay able in other than U.S. funds. Our time schedules contain other instructions for sort ing and listing items. - 3 - Paragraph 19 is amended by adding the following new subparagraph: Items Payable Outside a State (Foreign Items) For a foreign cash item payable in U.S. funds, we give deferred credit for the full face amount of the item in U.S. funds. For a for eign cash item payable in other than U.S. funds, we give deferred credit in U.S. funds, based on the exchange rate applicable on the date that we deliver the item to the subse quent collecting bank. In handling a foreign cash item, we act solely as agent for collec tion. The sender bears all risk of loss aris ing from exchange rate fluctuation during the processing of a foreign cash item. Our agreements with subsequent collecting banks governing the collection of foreign items are available on request. Senders should recog nize that credit is provisional and that the time for return of foreign items may vary under foreign law. Paragraph 34 is amended by adding the following language at the end of that paragraph: A bank may return to us a foreign cash item received from us; and we, any subsequent re turning bank, and the depositary bank shall handle the item as a returned check under Regulation CC, Regulation J, and this bulle tin. Effective June 1991