BRIDGEPORT - Exactly half of all money invested in West Virginia Tuesday by the Board of Treasury Investments went to small, rural institutions.
Of $30 million snapped up by state banks during an on-line, certificate of deposit auction, $15 million went to smaller banks such as Freedom Bank, Inc. of Belington and Monongahela Valley Bank of Fairmont.
Freedom Bank, in fact, successfully bid on $5 million in BTI assets. The BTI, of which State Treasurer John Perdue is chairman, manages $2.5 billion in state operating funds.
Freedom offered the second-highest overall interest rate, offering the state 5.25 percent for $2 million of its total. Monongahela was right behind, successfully bidding four times for $1 million each.
"This auction is a nice blend of large and small banks," said Treasurer Perdue. "It accomplished exactly what we wanted it to - spreading a little bit of wealth all over the state."
Large banks taking home $5 million each were BB&T of Charleston; Huntington Banks of Charleston; and United Bank of Parkersburg.
Banking companies "bid," or offered their interest rates during a presentation observed by some media at The Wingate Inn in Bridgeport.
Banks offered $47.6 million in bids, just slightly less than the $50 million bid upon during the BTI's August auction. The BTI had only $30 million to invest.
The banks benefit from added lending capital; state government gains a slightly higher return on its investment than had it simply invested in U.S. Treasury notes. State officials made $9,500 more in interest Tuesday by making the process competitive.
"It's our hope that these banks will invest this money in their local communities, in ways that will benefit working people," Treasurer Perdue said. "The additional money earned for the state is not the main thrust."
The BTI also held auctions in May and August. To date, the BTI has earned a little more than $2 million in interest from the three auctions.
"On-line auctions are a wonderful way to make use of today's technology," said BTI executive director Glenda Probst, "and offer every bank in competition an even playing field. We can't wait to hold another and put more lending capital into local hands."
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