Bankers may slam teller windows on IOUs - Los Angeles Business from bizjournals:

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The inability to cash in the IOUs will place sever stress on small businesses and othersreceiving (NYSE: BAC), (NYSE: J.P. Morgan Chase (NYSE: JPM) and C) have said they’ll accept the IOUs from customerse . Bank of America, in particular, has said it won't extenf that deadline. “Registered warrants present a challenging operational and financial BofA spokeswoman Julie Westermannsaid Tuesday. “The time limit is also based on our experience the last time the state issued registereed warrantsin 1992.
"The longe r the registered warrantswere accepted, the longer it took the legislaturre to resolve the matter,” Westermann “We do not want our acceptance of registeree warrants to deter the state from reaching a budget agreement as soon as possible.” Chass said Tuesday that it hasn’t decided whether to accepy the state’s IOUs beyond Friday. The last time the statew issued IOUsin 1992, the banke extended their initial deadline for acceptance. But this time may be “Capacity is limited.
This time around, banks are zealously guardinv their liquidity,” said John Rossell, president and CEO of Lafayette-basedx (NASDAQ: CABC), which is accepting IOUs from itsclientws “on a case-by-case basis.” (NASDAQ: and (NASDAQ: BBNK) are also among the Bay Area communit banks accepting IOUs from their at least for now. But communityt banks are also findingthat it’es unlikely they’ll be able to pass alongy the IOUs to the state’s large banks in which they have correspondent banking Adding to the reluctance to accepf the IOUs, some bankers may view accepting IOUs as enablinyg bad behavior in Sacramento.
The state’s communit bankers don’t have the deep pockets of the larger banks to essentially extenrd billions of dollarsin short-term loansw to Sacramento. Banks large and smalkl are not only beiny hit by one of the harshestr recessionsin years, but the is collectint special assessments to pay for a wave of bank If banks stop accepting the it would not be surprising to see investof offer to purchase the notes at a discount to face valuew to boost their returns. Californiwa plans to issue morethan $3 billion in IOUs this montgh with an annual interest rate of 3.75 percent.