Well, a rip in the cover is ok as long as it is smaller than, i think, 1 inch.  So, As long as the "punch" is small I would think it's totally ok.

As long as it is smaller than 1" it is perfectly postable.

I would think it's postable as UBS frequently take out a part of the cover.  As long as it's less than 1 inch.  I've noticed it's more common now for them to put a black slash along one side of the book or stamp them.  My local UBS puts a shamrock stamp on all their books. So maybe this one came from a UBS that takes a hole punch to theirs.  If you're worried about it-you can always PM the person who request the book before you send it out. Just make sure to choose the longest mailing option and give them a respond by deadline such as "I'm mailing (or canceling) the book  if I don't hear from you by x date". Just be aware that if you cancel, you lose your place in the FIFO line.

If there's a lot of copies of the book in the PBS system already, you could offer it as a freebie.  If it's a WL book-I'd post it in the book bazaar and offer to post it directly to someone who doesn't mind the hole punch.  Then you can go to their WL and post it right to them.

Sounds 100% postable to me!

just curious - what is UBS?

Used Book Store

ahhh . . .

(light goes on)

I'd post it.