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Federal R eserve Bank

J . S A L V A G G IO


f i r s t V IC E p r e s i d e n t

June 21, 1991
Notice 91-51

The Chief Operating Officer of
each financial institution in the
Eleventh Federal Reserve District
New Canadian Check Collection Service

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
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 (




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.


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.
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
Paragraph 5 is also amended by adding subparagraph (d), which shall
(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.




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

Effective June 1991

Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102