The Board of Treasury Investments and state banks both benefited when they kicked off a new fiscal year with an on-line certificate of deposit auction Wednesday, the first in an expanded series of such events.
The auction, observed by several state and community bankers and banking organizations along with two House of Delegate members, earned the state $28,000 more than if the state had simply purchased treasury notes at the most recent six-month T-bill auction rate of 5.055 percent.
BB&T, Freedom Bank of Belington and United Bank all successfully bid on $5 million Wednesday. Through the first six auctions BB&T has successfully bid on $30 million. Belington, a representative of the state's smaller banks, has taken home for local development $26 million. To view full results, go to www.bidWVauction.com.
Future auctions are scheduled Sept. 12 and Oct. 10 of this year and Jan. 9, March 12 and April 9 of 2008. This schedule increases the number of auctions to six from four and for the first time ever, they will offer one-year CD auctions at the October 10 event and again at an auction scheduled for April 9 of 2008. All other auctions will sell six-month CDs, as state banks place interest rate bids on the money available.
"To meet an increased demand for such auctions is work we're eager to do," said State Treasurer John Perdue, chairman of the BTI. "Banks have responded to the available funds with competitive interest rate bidding. State residents benefit when banks turn that money into loans."
Future auctions are scheduled Sept. 12 and Oct. 10 of this year and Jan. 9, March 12 and April 9 of 2008.
The additional auctions will double the amount of money on deposit with state banks.From May 2006 to present, the BTI has conducted six such events, awarding state banks $154 million through the auction process.
During the Wednesday auction at the state Capitol Building in Charleston, banks bid a total of $64 million, far and above the $25 million available.
Go to: BidWVauction Home Page
Please direct questions and comments regarding bidding procedures to the Auction Administrator or call (412) 391-5555.