Treasury to Auction $70 Million in CDs to Louisiana Banks January 16

Treasurer Kennedy Says BidLouisiana Meets Banks’ Growing Demand for State Deposits

BATON ROUGE, LA – In an effort to meet Louisiana banks’ growing demand for state certificates of deposit (CDs), the Louisiana Department of the Treasury will auction $70 million in CDs online on Tuesday, January 16, at 10:00 a.m. The 30-minute auction will take place at www.BidLouisiana.com, according to State Treasurer John Kennedy.

“Last year we put $60 million in CDs up for bid at each auction, and awarded a total of $240 million to 71 Louisiana banks,” said Treasurer Kennedy. “We are raising the amount to $70 million an auction because of increased participation and demand for CDs. Short-term investments like CDs are very attractive to banks right now. In addition, a large number of consumers statewide are taking out loans, which increases financial institutions’ need for funding sources.”

BidLouisiana is a competitive auction website somewhat similar to eBay® where banks have 30 minutes to bid on state deposits. Each bank’s bid consists of the amount of money it wants and the interest rate it is willing to pay. At the end of the auction, the Treasury awards cash to the banks with the highest bids in exchange for CDs.

“The most a bank can win during a BidLouisiana auction is $5 million, and more banks have been trying to win the maximum amount possible,” said Treasurer Kennedy. “This makes for a much more competitive auction, and competition is the key to BidLouisiana’s success.”

By law, the Treasury may place for competitive bidding up to 50 percent of state funds available for CD investment. The Treasury holds BidLouisiana auctions on the third Tuesday of the month in January, April, July and October. For more information or to sign up for the January BidLouisiana auction, contact the Treasury’s Investments Division at (225) 342-7004.

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