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#1115332 - 01/22/09 07:30 PM check holds and returned items
mincie Offline
Junior Member
Joined: Jul 2007
Posts: 43
I'm trying to get a general idea of the effectiveness of check holds in preventing losses from returned deposited items.

What percentage of deposited items are held?
What percentage of the held items are returned?
What percentage of held items are returned within the hold period?
What is the average value of a returned held item?

Is there anywhere to get more statistics on returned items?

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#1122060 - 02/03/09 08:17 PM Re: check holds and returned items mincie
mincie Offline
Junior Member
Joined: Jul 2007
Posts: 43
I found data from a national bank stating that they hold or otherwise delay 2.5% of deposits. Is this true of all the largest national banks? It seems like a low number.

I also found inconclusive data that approximately 25% of deposited items placed on hold are returned. That sounds like a pretty high number.

By combining the above figures the percentage of all deposits which are held and returned is .625%. So if a bank has $400 billion in deposits in a year this gives $2.5 billion in returned items that are held.

Does this sound generally right for most large banks that apply holds or delay funds availability?

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#1122068 - 02/03/09 08:21 PM Re: check holds and returned items mincie
BrendaC Offline
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BrendaC
Joined: Sep 2001
Posts: 6,029
Sweet Home AL
I think these percentages are going to be driven by a bank's specific hold policy. If a bank has automated procedures and routinely holds certain types of deposits the percentage returned may be significantly lower that for a bank that places holds only on items they already suspect may not be collectible.
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#1122082 - 02/03/09 08:30 PM Re: check holds and returned items BrendaC
mincie Offline
Junior Member
Joined: Jul 2007
Posts: 43
I would certainly expect that the percentages would depend on the availability policy. What I am interested to know is if my numers are in the right range and what that range might be in specific numbers, i.e., how high or low the variance is. One might posit the standard case of Regulation CC and model disclosures as a basic availability policy for the combined average across all banks in general. Another example might be limited say to items over $5,000 as routinely held and what numbers that yields.

I am particularly interested in surveying what percentage of items held or delayed are generally returned.

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