Methods of Sending and Presenting; Sending Direct to Payor

Bank.

(1)A collecting bank must send items by reasonably prompt method taking into consideration any relevant instructions, the nature of the item, the number of such items on hand, and the cost of collection involved and the method generally used by it or others to present such items.

(2)A collecting bank may send

(a)Any item direct to the payor bank;

(b)Any item to any nonbank payor if authorized by its transferor;

(c)Any item other than documentary drafts to any nonbank payor, if authorized by Federal Reserve regulation or operating letter, clearinghouse rule or the like;

(d)Any item to any Federal Reserve bank; and

(e)Any item to any other bank or agency thereof. Items may be sent to the place of business of, or to any place designated by, those to whom items may be sent under paragraphs (a), (b), (c),

(d)or (e). COL120106 DIV. 4 BANK DEPOSITS AND COLLECTIONS