Online auction places $50 million with Louisiana banks
Baton Rouge, LA — The Louisiana Department of the Treasury completed its 50th Bid Louisiana auction by auctioning $50 million worth of certificates of deposit (CDs) today to provide much-needed capital to 16 community banks across the state, according to State Treasurer John Kennedy.
"The state relies on CDs as a stable, low-risk investment," said Treasurer Kennedy. "We use an online auction to get the best possible price on CDs while at the same time providing liquidity to Louisiana banks."
Using BidLouisiana.com, the Treasury awarded cash to winning banks with the highest bids in exchange for CDs. Each bank's bid consists of the amount of money it wants and the interest rate it is willing to pay.
The state has been using the BidLouisiana website to auction CDs online since 2001, and since this time, 65 participating banks have submitted 3,346 bids for more than $3.96 billion. Over the past 12 years, these banks have won 846 bids totaling more than $2.6 billion. Since the inception of the program, BidLouisiana has grossed the state nearly $1.0 million in additional earnings.
"Because of BidLouisiana, local banks all across the state will have more cash available for businesses and individual customers," said Treasurer Kennedy. "This results in more money moving into our communities through small business and consumer loans."
By law, the Treasury may competitively bid up to 50 percent of state funds available for investment in CDs. The next BidLouisiana auction will be held October 15, 2013.
For more information about BidLouisiana, visit the Louisiana Department of the Treasury's website at www.LATreasury.com. Stay connected with the Treasury at Facebook.com/LouisianaTreasury or Twitter.com/LATreasury.