Sec. 42a-4A-506. Rate of interest.
Sec. 42a-4A-506. Rate of interest. (a) If, under this article, a receiving bank is
obliged to pay interest with respect to a payment order issued to the bank, the amount
payable may be determined (i) by agreement of the sender and receiving bank, or (ii)
by a funds-transfer system rule if the payment order is transmitted through a funds-transfer system.
(b) If the amount of interest is not determined by an agreement or rule as stated in
subsection (a), the amount is calculated by multiplying the applicable Federal Funds
rate by the amount on which interest is payable, and then multiplying the product by
the number of days for which interest is payable. The applicable Federal Funds rate is
the average of the Federal Funds rates published by the Federal Reserve Bank of New
York for each of the days for which interest is payable divided by three hundred sixty.
The Federal Funds rate for any day on which a published rate is not available is the
same as the published rate for the next preceding day for which there is a published rate.
If a receiving bank that accepted a payment order is required to refund payment to the
sender of the order because the funds transfer was not completed, but the failure to
complete was not due to any fault by the bank, the interest payable is reduced by a
percentage equal to the reserve requirement on deposits of the receiving bank.
(P.A. 90-202, S. 1(4A-506), 3.)