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BOFD, What is this?
Answer by Mary Beth Guard, BOL Guru

Question: What is a bank of first deposit?

Answer: The Bank of First Deposit (BOFD) is the first financial institution to which a check or item is negotiated. The term is somewhat misleading because it applies even where the institution gives its customer cash, rather than accepting the item only for deposit.

So, if Andy writes me a check and I take it to my bank to cash it or deposit it, my bank is the bank of first deposit.

First published on 06/21/04

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