Common use of Collection Items Clause in Contracts

Collection Items. The Bank may accept certain items on a collection basis only, including payments on oil and gas leases, certain securities and checks payable in foreign currencies or at foreign locations. The Bank routes and processes collection items separately. The Bank normally credits your account for collection items only after the Bank receives payment for them. If the Bank credits your account and then does not receive payment, the Bank may debit your account for the amount of the item. The Bank may charge fees for processing collection items. These fees apply even if the collection item is returned unpaid. See the current Consumer Deposit Accounts Brochure for current collection fees. The financial institution on which the collection item is drawn may also charge you fees. If the other financial institution requires payment of a fee before that institution will process the collection item, the Bank may pay the fee and charge your account. Otherwise, the other financial institution may subtract its fee from the amount of the payment the Bank receives. These fees also may apply even if the collection item is returned unpaid. CNB may refuse to accept for deposit or collection a check, draft, or other item that is payable in a currency other than U.S. dollars or that is drawn on a bank or a branch of a bank located outside of the United States (”foreign instrument”). If the Bank accepts a foreign instrument for deposit or collection, you bear all of the risks associated with the collection process and foreign currency fluctuation (exchange rate risk). Actual credit for deposits of, or payable in, foreign currency will be at the Bank’s exchange rate then in effect on final collection in U.S. dollars. A foreign instrument may be returned unpaid much later than instruments that are drawn on banks located in the United States, sometimes several months after the Bank processes the foreign instrument. You bear all the risks of a late return. Generally, the Bank will not credit a foreign instrument to your account until the Bank receives the proceeds in cleared funds from the paying bank. If the Bank does provide credit, such credit is provisional and the Bank may reverse the credit at any time if the foreign instrument is returned unpaid or is initially paid but then subsequently returned for fraud. You agree that the Bank may use the then-current exchange rate for such reversals and the Bank may charge your account for the full value of the foreign instrument, including any applicable fees, which may result in a loss to you.