Question 340. - A bank discounts for its customer in Prince Edward Island a time bill drawn say on Halifax. This bill is paid by the acceptor the day after maturity. Due to the transportation difficulties the discounting bank does not receive a remittance until fifteen days after the due date. Is the bank entitled to interest for the period between the maturity date and receipt of the remittance, and can it collect such interest from its customer?

Answer. - A bank discounting a bill in the ordinary course of business becomes the purchaser of it, the consideration being the proceeds paid to the vendor. It follows that it has to stand by its obligation and should, therefore, provide for all contingencies when discounting it. In practice, the matter is one for arrangement between the bank and its customer, and if the latter declines to pay additional interest, the bank has no recourse.