WASHINGTON TIMES: "Cash run for 2000 unlikely, banks say "greenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread
Nothing concerning people's reaction to Y2K surprises me anymore...although the year isn't over yet, and the banks still have a dozen or so business days to find out whether people tell the truth when asked these kinds of questions:)!
December 15, 1999
Cash run for 2000 unlikely, banks say
By Julie Hyman
THE WASHINGTON TIMES
Banks are comforted by pollsters who say the public has accepted their reassuring words about the new year.
Peter-Paul Galus money wont be under a mattress come New Years Day.
Instead, it will remain in the bank because Mr. Galus, an Arlington, Va., resident who stopped by the Union Station post office yesterday, believes the financial services industry is prepared to tackle the year-2000 computer bug.
Banks are comforted by pollsters who say the public has accepted their reassuring words about the new year. So some local banks are scaling back on the amount of money they plan to have on hand for Jan. 1. Washington-area banks do not plan to open on New Years Day, unlike some West Coast banks that will remain open on the holiday to address any customer concern that may arise.
Mr. Galus isnt worried.
Im very confident. Ive received a lot of notices from the bank, he said.
Buoyed by consumer attitudes like Mr. Galus, FCNB Corp., a Frederick, Md., bank, has reduced the amount of cash in its emergency year-2000 reserves. If FCNB comes up short, it plans to tap into cash stockpiles at the Federal Reserve.
It appears less and less that its going to be a real issue, said A. Patrick Linton, the banks president and chief executive officer.
The year-2000 bug is expected to strike when computer clocks roll over to 2000, confusing machines that were only programmed to deal with the last two digits of the year. But 99 percent of banks were ready for the glitch in August, according to a report by the Federal Financial Institutions Examination Council.
Though financial institutions computer systems may be ready, they still must address the question of public perception whether consumers, fearing bank failure, will withdraw large amounts of money. So far, mass withdrawals are not occurring.
Adams National Bank in the District has taken similar steps as FCNB.
Our cash buildup was going to be based on needs of the consumer, said Mary Mills, assistant vice president of information technology for Adams.
Customer demand for cash hasnt gone up so far, and the bank has only had two inquiries about its year-2000 readiness both from customers who wanted to deposit, not withdraw, money.
Ms. Mills said Adams does have means to get more cash if necessary.
The government is also prepared to pay out more currency to banks. Last year, the Fed asked the U.S. Treasury to print $50 billion in additional bills to prepare for a possible year-2000 rush for cash. The agency is recommending that banks have a comprehensive year-2000-bug and cash-availability plan.
The Fed now has $200 billion in its coffers, and will pump that money out to banks if there is widespread panic around the new year. But most banks and regulators dont expect that to happen.
[Consumers] are not going to be withdrawing as much, or probably not at all at least not more than a regular holiday weekend, said Fed spokeswoman Rose Pianalto.
Her predictions seemed to play out during an informal survey of Union Station patrons yesterday.
John McCargo, an Amtrak employee from Baltimore, said he is not planning to have extra cash on hand for New Years Day.
Im just going to make sure that all my accounts are up to date, he said.
Linda Wilson of Northern Virginia said she will get more money out for a vacation.
Im not going to take any chances. . . . I just want to have a cushion, she said.
Maryland resident Gerri Robinson laughed at the idea that she would clean out her bank account.
I dont think anythings going to happen, she said.
Many banks are still preparing just in case.
We made our plans a long, long time ago and were sticking with them, said Frank Small, executive vice president of the Sandy Spring Banks retail delivery group.
The bank has a contingency plan to open on New Years Day, a Saturday but Mr. Small doesnt expect to have to implement it.
The bank will stock about 50 percent more cash than usual, both in branches and automated teller machines. For now, Mr. Small said, banks are playing a waiting game to see if consumer demand will explode.
First Virginia Banks of Falls Church is another company that hasnt altered its date-change plan. The bank will have staffers present Jan. 1, but branches wont be open. And bank management is figuring out how much additional cash to stock at each branch and ATM.
But all the more aggressive plans at local banks seem to be contingencies at this point. Even the Consumers Union, a District-based consumer advocacy group that zeroes in on public issues, is not concerned about banks readiness for 2000.
It seems at this stage that everything is under control when it comes to the banks, said Frank Torres, legislative counsel for the organization.
-- John Whitley (email@example.com), December 16, 1999
"...everything is under control when it comes to the banks". Yep, sure is: spin control.
-- King of Spain (firstname.lastname@example.org), December 16, 1999.
Are we talking the new kind of "canned corned beef cash" here, KOS, or the old "hmm - now what can I use this paper for?" type...?
-- John Whitley (email@example.com), December 16, 1999.
It don't matter what the polls say. Americans do have great trust in the banks. I have always believed that bank runs would start in other countries first, then here.
When January 1 comes, depositors will begin to hear from banks, "our computers are down." Banks will hear from other banks, they cannot repay their loans. There will be a true bankruptcy.
The code is broken.
-- BB (firstname.lastname@example.org), December 16, 1999.
A local TV station had a call in show last night about y2k. I called and ask a bank president how his bank was going to keep bad data from corrupting good data at his bank. He stated that all but five bank in the US were ready so that wasn't a concern. I pressed the issue as to whether he tested his systems with other banks. NO was his reply. I ask if his bank dealt with overseas banks. At this point he started to stumble for an answer. There is or was any testing between banks. He stated that they tested intra-bank but didn't think end to end testing was necessary. I think in two weeks we find out. I got my money do you have yours??
-- yk2 dave (email@example.com), December 16, 1999.
Mr. Galus isnt worried. Im very confident. Ive received a lot of notices from the bank, he said. ..................
I'm about to laugh myself silly. Hello? Earth to Mr. Galus, come in, come in, do you read me?
No wonder we have a fractional reserve system that is a house of cards waiting for a stiff breeze. Idiots like Mr. Galus paved the way with their, "Sure, if the bank says it's a good idea, then it's ok with me", mentality.
-- paul leblanc (firstname.lastname@example.org), December 16, 1999.