Puerto Rican Bank Loses Appeal Over Lost Federal Reserve Account

Federal Reserve banks maintain discretionary authority to grant or deny access to their master accounts, a federal appeals court said in a ruling upholding the dismissal of Banco San Juan Internacional Inc.'s suit to have its master account reopened.

BSJI or any other bank that isn’t chartered under federal, state, or territorial law—and thus isn’t subject to oversight by the Federal Reserve—doesn’t have a statutory entitlement to Federal Reserve Bank services through a master account, the US Court of Appeals for the Second Circuit said in an opinion Tuesday.

The decision marks the latest failed effort by BSJI to maintain ...