A bank is a multi-state financial institution but all of the proof work is done in one state (state A). If a branch in state B receives a check from a state agency in state A, can the branch in state B place a case by case hold on the check or does this instrument fall under the part 229.10 of Reg. CC? If the check is greater than $5,000, can you place an Exception Hold on the check?

The key is the location of the branch. In order to qualify as a government check requiring next-day treatment under Regulation CC, the check must be issued by a state or local government in the same state as the branch accepting the deposit.

That's is what I thought as well John but just needed assurance.