US banks near Y2K readiness, regulators say

Don't stuff mattress, but have ready cash

BY ANDREW CLARK REUTERS

WASHINGTON -- U.S. banks are making good progress on fixing millennium-related computer problems and the public should not panic about the issue, top banking regulators said.

They told Congress Tuesday that most banks had taken the necessary steps to rid their computer systems of the so-called Y2K computer bug. They also said that even if some problems did crop up, contingency plans were in place to limit their impact.

"I am increasingly optimistic about prospects for a transition relatively free of disruptions," Federal Reserve Governor Edward Kelley told the House Banking Committee. "The most likely outcome is that Y2K technical issues will cause no more than inconveniences in the financial sector of the United States."

The millennium, or Y2K, bug arises because many older computers record dates using only the last two digits of the year. If left uncorrected, such systems could treat the year 2000 as the year 1900, generating errors or systems crashes.

Comptroller of the Currency John Hawke said the "overwhelming majority" of U.S. banks would meet a June deadline for the complete testing of their computers, with 96% of national banks now having satisfactory Y2K ratings.

"Overall, the banking industry has made admirable progress in getting ready for the century date change," he said. "I think the banking industry is going to come through this Y2K challenge with flying colors."

The regulators urged consumers not to rush to withdraw money ahead of the millennium. Many Americans are expected to load up on cash as 1999 draws to a close, putting a further strain on banks.

"We do not believe the public needs to hold excess cash," Mr. Kelley said. "We expect the normal payment methods, including credit cards and checks, will be functional and funds . . . held in depository institutions are most safely kept right there."

He said the Federal Reserve had detailed plans to make extra cash available to banks if they needed it, although it was not expecting to see a surge in withdrawals.

A study released Tuesday by the National Association of Federal Credit Unions found 72% of consumers surveyed were not worried about the safety of their accounts at financial institutions, while 22% were worried enough to consider withdrawing some funds before the end of 1999.

"If you are concerned, take money for a long weekend, but don't take more than that," said Office of Thrift Supervision Director Ellen Seidman, noting "mattress stuffing" carried physical, as well as fiscal, risks.

Ms. Seidman said there were practical steps consumers could take to protect themselves, the most important being to keep copies of financial records and, toward the end of the year, even ATM transaction slips.

Bank groups testifying at the hearing said the industry was sparing no expense in its efforts to beat the Y2K bug, and urged lawmakers to pass pending legislation limiting lawsuits stemming from the issue.

"Since 1995, the banking industry has devoted millions of man-hours and billions of dollars to addressing Y2K," said Scott Anderson of Zions First National Bank, testifying on behalf of the American Bankers Association. "The litigation threat is an impediment, a distraction from the tremendous task at hand."

Some lawmakers have also suggested a special Year 2000 holiday either Dec. 31 or one of the first business days after the new year, to give companies an extra day to check that their systems are working properly.

But Mr. Kelley said this could send a troubling signal to the public and to financial markets.

"We are opposed to taking actions that could unnecessarily erode public confidence in the industry, where erosion of confidence can create significant destabilizing effects on our economy," he said.

-- Norm (nwo@hotmail.com), April 15, 1999

Answers

Pay no attention to the Norm behind the curtain, Dorothy.

You either, Toto.

After all, you're not in Kansas any more.

"Significant destabilizing effects on our economy?" GET A LIFE! The economy is a bubble looking for a pin. You wanna see destabilizing? Wait... .

For the record, and lest I be accused of fearmongering, I will not have taken all my money out of banks or the market by rollover. I have sufficient cash on hand, plus physical gold and silver, to get through anything I can conceive of money helping one live through. I have made what seem to me to be adequate preparations. That done, there is still money in the banks and in the market (though all is weighted to assume the downside now- Swiss franc CD's, Midas Fund which is mining stocks, Central Fund Canada which is gold/silver bullion, Prudent Bear and Rydex Ursa which anticipate market declines). I may be premature in going short- the Dow might see 12,000 yet.

-- (li'ldog@stillontheporch.com), April 15, 1999.

My local bank send us a flyer this week...

Tips for y2k...

1. Stock up on food

2. Stock up on water

3. Stock up on batteries and candles

etc. etc..

6. DO NOT WITHDRAW CASH....

If anyone has trouble believing this I will type the EXACT text and name and phone of bank.

-- STFrancis (STFrancis@heaven.com), April 15, 1999.

London Bankers" <:)=

... "The quiet, bespectacled man from the Financial Services Authority admitted that 12 large financial institutions are so far behind with their preparations to cope with the millennium bug that they could pose a serious risk to their customers and the markets. He is so worried by their potential to do damage that he is threatening to close them down."

... "The financial industry is like a house of cards," shuddered one insider yesterday. "If one business founders, the others feel it."

... "Until now, the Bank of England has insisted that Britain's financial institutions were coping with the bug."

-- Sysman (y2kboard@yahoo.com), April 15, 1999.

Seems that this fellow "Norm" is a verbal hit-and-run artist. Never hangs around to defend his news article picks. He must get a chuckle out of repeatedly pulling our collective chains... oh, and from the pace of his postings seems to be either a troll or someone who has too much time on his hands and is conducting a patronizing low-key "jihad" against G.I.'s. At least that is my impression.

-- Jeremiah Jetson (laterthan@uthink.y2k), April 15, 1999.

SAM: "What's shaking Norm?"

NORM: "All four cheeks & a couple of chins."

================================================================ SAM:

"What's new Normie?"

NORM: "Terrorists, Sam. They've taken over my stomach & they're demanding beer."

=================================================================

SAM: "What'd you like Normie?"

NORM: "A reason to live. Give me another beer."

=================================================================

SAM: "What'll you have Normie?"

NORM: "Well, I'm in a gambling mood Sammy. I'll take a glass of whatever comes out of that tap."

SAM: "Looks like beer, Norm."

NORM: "Call me Mister Lucky."

==========================================================

SAM: "Hey Norm, how's the world been treating you?"

NORM: "Like a baby treats a diaper."

=================================================================

WOODY: "What's the story Mr. Peterson?"

NORM: "The Bobbsey twins go to the brewery. Let's cut to the happy ending."

============================================================== WOODY:

"Hey Mr. Peterson, there's a cold one waiting for you."

NORM: "I know, if she calls, I'm not here."

===================================================================

SAM: "Beer, Norm?"

NORM: "Have I gotten that predictable? Good."

================================================================ SAM:

"Whatcha up to Norm?"

NORM: "My ideal weight if I were eleven feet tall."

====================================================================

WOODY: "How's it going Mr. Peterson?"

NORM: "Poor."

WOODY: "I'm sorry to hear that."

NORM: "No, I mean pour."

==================================================================

SAM: "How's life treating you Norm?"

NORM: "Like it caught me sleeping with its wife."

==================================================================

SAM: "What's going down, Normie?"

NORM: "My butt cheeks on that bar stool."

===================================================================

WOODY: "Pour you a beer, Mr. Peterson?"

NORM: "Alright, but stop me at one....make that one-thirty."

================================================================

WOODY: "How's it going Mr. Peterson?"

NORM: "It's a dog eat dog world, Woody & I'm wearing Milk Bone underwear."

====================================================================

SAM: "What's the story Norm?"

NORM: "Boy meets beer. Boy drinks beer. Boy meets another beer."

==================================================================

WOODY: "What's going on Mr. Peterson?"

NORM: "The question is what's going in Mr. Peterson? A beer please, Woody."

=================================================================

WOODY: "Can I pour you a beer Mr. Peterson?"

NORM: "A little early isn't it, Woody?"

WOODY: "For a beer?"

NORM: "No, for stupid questions."

-- Andy (2000EOD@prodigy.net), April 15, 1999.

I'll drink to that Andy. How do you spell it... <:)=

C hh eee rrrr eeeee ssssss

-- Sysman (y2kboard@yahoo.com), April 16, 1999.

STFrancis...I would like to see a copy of the bank letter! If true, WHAT A HOOT!!!

-- K Stevens (chiam123@aol.com), April 16, 1999.

Never mind... <:)=

NORM: "Have I gotten that predictable? Good."

-- Sysman (y2kboard@yahoo.com), April 16, 1999.