I. INTRODUCTION
Although several consumer regulations use the term “business day,” the definition of that term is unique to each regulation. This can cause confusion on the part of bankers trying to comply with these regulations. The purpose of this article is to give you a one-stop reference as to the various definitions of “business day” which may be found in the most common consumer compliance banking regulations.
II. BANK SECRECY ACT
Under the Bank Secrecy Act and its Financial Recordkeeping and Reporting Regulations, a “business day” means a day normally communicated by the bank to its depository customers on which the bank routinely posts a particular transaction to its customers; accounts. See, 31 C.F.R. § 103.11(t).
III. REGULATION CC
The Expedited Funds Availability Act and its implementing Regulation CC defines a “business day” as a calendar day other than a Saturday or Sunday and the following federal holidays: January 1 (New Year’s Day); the third Monday in January (Martin Luther King’s Day); the third Monday in February (President’s Day); the last Monday in May (Memorial Day); July 4 (Independence Day); the first Monday in September (Labor Day); the second Monday in October (Columbus Day); November 11 (Veteran’s Day); the fourth Thursday in November (Thanksgiving Day); and December 25 (Christmas Day). When fixed-date holidays (January 1, July 4, November 11 or December 25) fall on a Sunday, the next Monday is not a “business day.”
NOTE: Be sure to not confuse the term “business day” with “banking day” in this regulation. “Banking day” is defined in Regulation CC as the part of any “business day” on which an office of a bank is open to the public for carrying on substantially all of its banking functions. See, 12 C.F.R. § 229.2(g).
IV. REGULATION DD
Regulation DD is the implementing regulation of the Truth-in-Savings Act. The term “business day” is used in this law and regulation as a calendar day other than a Saturday, a Sunday, or any of the federal holidays (January 1 (New Year’s Day); the third Monday in January (Martin Luther King’s Day); the third Monday in February (President’s Day); the last Monday in May (Memorial Day); July 4 (Independence Day); the first Monday in September (Labor Day); the second Monday in October (Columbus Day); November 11 (Veteran’s Day); the fourth Thursday in November (Thanksgiving Day); and December 25 (Christmas Day). When fixed-date holidays (January 1, July 4, November 11 or December 25) fall on a Sunday, the next Monday is not a “business day.”) See, 12 C.F.R. § 230.2(g).
V. REGULATION E
As used in the Electronic Funds Transfer Act and its Regulation E, the term “business day” means any day which the offices of the bank are open to the public for carrying on substantially all business functions. See, 12 C.F.R. § 205.2(d).
VI. REGULATION X (HUD)
The Real Estate Settlement Procedure Act (RESPA) is implemented by the Department of Housing and Urban Development’s Regulation X. RESPA and its regulation define “business day” as any day, excluding both state and federal legal holidays, Saturdays, and Sundays. When the term “day” is used in the law or regulation, and the term is not specified as a “business day,” it means a calendar day. See, 24 C.F.R. § 3500.21(a)(1).
VII. REGULATION Z
The Truth-in-Lending Act and accompanying Regulation Z defines “business day” to mean a day when the “creditor’s” office is open to the public for carrying on substantially all of its business functions. When the issue involves the right of rescission, “business day” is defined as a calendar day, except Sundays and the federal legal holidays listed under federal law. The federal law lists ten legal holidays and identifies four holidays by a specific date (New Year’s Day, January 1; Independence Day, July 4; Veterans Day, November 11; and Christmas Day, December 25). The Official Staff Commentary clarifies that for these four holidays, only the date specified in the statute is considered a legal holiday for purposes of rescission. Thus, if the date specified in the statute falls on a weekend, the Friday before the specified date or the Monday following it are considered business days even if government offices are closed in observance of the holiday. See, 12 C.F.R. § 226.2(a)(6).
VIII. CONCLUSION
As you work with the above-cited regulations, please be aware that each regulation may have unique definitions of commonly understood words. A refreshment of such common definitions should help avoid confusion that would naturally occur if the wrong definition is applied to a regulation. There are also times when similar terms are used and interpreted to have the same meaning. Under the Regulation CC discussion, “business day” and “banking day” have separate definitions. The same is true under the Uniform Commercial Code, the state law that governs negotiable instruments and bank deposits and collections. Under U.C.C. § 4-104, “banking day” means the part of a day on which a bank is open to the public for carrying on substantially all of its banking functions. This term is similar to, yet different from the Regulation CC definition.