Is a bank required to have adequate cash (FRN) on hand to cash out a large check?

[Magnus the Destroyer]

David, au contraire, my unwitting mentor. I have followed your work casually for a couple years now, and I endorse EVERYTHING of a fiduciary nature with "REDEEMED IN LAWFUL MONEY PER 12 USC 411" and then my signature.

However, you just clued me in to something I obviously missed along the way: by demanding lawful money I am not subject to unspoken rules regarding availability of funds on hand? If this is the case, it is something I will definitely pursue the next time. I will be earning more 4&5 figure checks in the future, and will be happy to do some experimenting. A pointer to what I should be studying is welcome.

Of note was that the upper level fixer that rounded up the money for me volunteered some additional information that was interesting: she said when she spoke to my hometown branch she asked if they could handle cashing the check and she told me that they told her yes; she then said she asked them if it would impact their reserves at all and she told me they said no. So it would seem the only reason they gave me grief was not because they didn't have the cash but because (speculating) their policy did not allow the cashing of such a check to a non-customer without prior arrangements. Otherwise, their reserves can handle it.

[David Merrill]

David, au contraire, my unwitting mentor. I have followed your work casually for a couple years now, and I endorse EVERYTHING of a fiduciary nature with "REDEEMED IN LAWFUL MONEY PER 12 USC 411" and then my signature.

However, you just clued me in to something I obviously missed along the way: by demanding lawful money I am not subject to unspoken rules regarding availability of funds on hand? If this is the case, it is something I will definitely pursue the next time. I will be earning more 4&5 figure checks in the future, and will be happy to do some experimenting. A pointer to what I should be studying is welcome.

Of note was that the upper level fixer that rounded up the money for me volunteered some additional information that was interesting: she said when she spoke to my hometown branch she asked if they could handle cashing the check and she told me that they told her yes; she then said she asked them if it would impact their reserves at all and she told me they said no. So it would seem the only reason they gave me grief was not because they didn't have the cash but because (speculating) their policy did not allow the cashing of such a check to a non-customer without prior arrangements. Otherwise, their reserves can handle it.

Adjusting to the new information then...

If you had been endorsing the FDIC would have had it covered. So the waiting and grief they gave you was probably because you were outside the scope of fractional lending with your Demand?

I love how very revealing this is.