I. INTRODUCTION
Official holidays for both state and national banks are governed by state and federal laws. This becomes important when determining liability under the midnight deadline set forth in the Uniform Commercial Code, and must be considered carefully when we plan to close on a Friday or Monday in lieu of a regularly scheduled holiday which would fall on an intervening day (Saturday or Sunday). The midnight deadline generally requires that an item be handled by midnight of the next business day following its receipt, to escape strict liability on the part of the bank in the event something goes wrong and the item is not paid.
II. NEBRASKA LAW (STATE CHARTERED BANKS)
Nebraska state statute section 62-301 contains the current law relative to holidays. The holidays are established as follows:
62-301. Holidays, enumerated; federal holiday schedule observed; exceptions; bank holidays.
(1) For the purposes of the Uniform Commercial Code and section 62-301.01, the following days shall be holidays: New Year’s day, January 1; Birthday of Martin Luther King, Jr., the third Monday in January; President’s Day, the third Monday in February; Arbor Day, the last Friday in April; Memorial Day, the last Monday in May; Independence Day, July 4; Labor Day, the first Monday in September; Columbus Day, the second Monday in October; Veterans Day, November 11, and the federally recognized holiday therefore, or either of them; Thanksgiving Day, the fourth Thursday in November, the day after Thanksgiving; and Christmas Day, December 25. If any of such dates fall on Sunday, the following Monday shall be a holiday. If the date designated by the state for observance of any legal holiday enumerated in this section, except Veterans Day, is different from the date of observance of such holiday pursuant to a federal holiday schedule, the federal holiday schedule shall be observed.
(2) Any bank doing business in this state may, by a brief written notice at, on or near its front door, fully dispense with or restrict, to such extent as it may determine the hours within which it will be open for business.
(3) Any bank may close on Saturday if it states such fact by a brief written notice at, on or near its front door. Where such bank shall, in observance of such a notice, not be open for general business, such day shall, with respect to the particular bank, be the equivalent of a holiday, as fully as if such day were listed in subsection (1) of this section, and any act authorized, required or permitted to be performed at, by or with respect to such bank which will, in observance of such notice not be open for general business, acting on its own behalf or in any capacity whatever, may be performed on the next succeeding business day and no liability or loss of rights on the part of any person shall result from such delay.
(4) Any bank which, by the notice provided for by subsection (3) of this section, has created the holiday for such bank may, without destroying the legal effect of the holiday for it and solely for the convenience of its customers, remain open all or part of said day in a limited fashion by treating every transaction with its customers on said day as though said transaction had taken place immediately upon the opening of such bank on the first following business day.
(5) Whenever the word bank is used in this section it includes building and loan association, savings and loan association, credit union, savings bank, trust company, investment company, and any other type of financial institution.
62-301.01. Holidays; transactions with bank; validity.
Nothing in any law of this state shall in any manner affect the validity of, or render void or voidable any transaction by a bank in this state because done or performed during any time other than regular banking hours; Provided, that nothing herein shall be construed to compel any bank in this state which by law or custom is entitled to close at a fixed hour on any day or for the whole or any part of any holiday, to keep open for the transaction of business on any day after such hour, or on any holiday, except at its own option.
Your attention is invited to 62-301(2) of the above which allows you to establish a different day for bank operation. Paragraph (3) deals with the requirement for closing a bank on Saturday. In this connection we submit the following sample notice:
Banking Hours
Banking hours from Monday through Friday are posted on the door. The bank will be closed for general business and bookkeeping on Saturday. BUT FOR THE CONVENIENCE OF CUSTOMERS, TELLER TRANSACTIONS WILL BE CONDUCTED ON SATURDAY MORNINGS for the first following business day. Legal holidays are governed by the law of the State of Nebraska.
(Posted in compliance with the law of the State of Nebraska.)
As with other portions of the NBA Compliance Handbook, the foregoing is suggestive and the final determination of the ultimate legality of your bank’s procedures should rest with your attorney.
III. FEDERAL LAW (NATIONAL BANKS)
12 U.S.C. section 95(b)(1) addresses the applicability of state banking holidays to national banks as follows:
In the event of natural calamity, riot, insurrection, war or other emergency conditions occurring in any state whether caused by acts of nature or of man, the Comptroller of the Currency may designate by proclamation any day a legal holiday for the national banking associations located in that state. In the event that the emergency conditions affect only part of a state, the Comptroller of the Currency may designate the part so affected and may proclaim a legal holiday for the national banking associations located in that affected part. In the event any day is designated as a legal holiday for ceremonial or emergency reasons, for the state or any part thereof, that same day shall be a legal holiday for all national banking associations or their offices located in that state or the part so affected. A national banking association or its affected offices may close or remain open on such a state-designated holiday unless the Comptroller of the Currency by written order directs otherwise.
National banks may, in their discretion, either close or remain open on such a state-designated holiday unless the Comptroller of the Currency by written order directs otherwise. See, 12 C.F.R. § 7.3000 regarding bank hours and closings.