Y2K Special Issue

The results of the Gallup Poll that was taken at the request of FDIC, OCC, OTS and Fed are in - and the banking industry is looking good! But, for added insurance, they suggest making major efforts to communicate preparedness.

Gallup called over 2,600 people during the two weeks of the study and asked them a variety of questions about Y2K and the banking industry.

What Y2K Problem?
An astonishing seven percent of American people say they have heard nothing about any year 2000 problems at all, let alone any with the banking industry! Over 80% of the public, however, is very much aware of what Y2K means.

Most of the general information about the coming millennium and possible problems anywhere in our society is received by way of television reporting and newspapers. As for information about the banking industry Y2K issue in particular, special questions were asked of the 92% of the 2,600 people who had bank accounts. Over half of them have not seen, heard or read anything specifically about the impact of the Y2K problem on the banking industry from any source.

Fear Of The Fringe
People who answered the Gallup Poll questions actually seem to be more concerned about banking disruption due to the behavior of depositors who attempt to withdraw all their funds from banks prior to January 1 than they do about any possibility of their bank itself having problems.

Confidence In Their Bank
Seventy-six percent of those polled said they do not expect their bank to have many problems at all. Of those who think the banking system may have problems, 81% of them feel those disruptions would be cleared up in a matter of days.

Nevertheless, customers appear to be prudent. Eighty-six percent of bank customers expect to confirm their account balances before year's end, and seventy-eight percent said they will keep better track of bank transactions. Eighty two percent say they will maintain their usual banking routine, and fifty-nine percent say they will discuss Y2K readiness with their bank before the end of the year.

How Much Cash Out?
As for how much cash customers plan to withdraw before December 31, results were all over the map. Sixty-two percent of respondents said they would take out extra cash, but amounts ranged from the 6% who expect to take "enough for a long weekend", all the way to the 2% who plan to withdraw enough "for a year or longer." The rest of the answers were: Undecided how much - 16%; One week - 12%; Several weeks - 9%; A month - 11%; Several months - 6%. Of the rest, 32% said they will not take any cash out, and 6% aren't sure what they're going to do!

Communication Vital
Less than one quarter of those with bank accounts say they have received any information at all from their bank or thrift, with that information coming to them by way of "statement stuffers", or special letters being sent out to them through the mail. But 75% of the depositors polled report they have heard nothing at all from their financial institution!

Gallup suggests this is a weak spot. With a half a year still to go before the century date change, banks have ample time to ensure that their customers are educated about the Y2K issue. Information to depositors from tellers, through community meetings, and personal letters from bank or thrift presidents would be most useful, they suggest. And with the majority of Americans getting their general information from television and newspapers, financial institutions and regulators need to take time to provide comprehensive and accurate information to local news organizations.

The agencies maintain that consumers with higher levels of knowledge about Y2K are more likely to take prudent, rather than drastic precautions. Efforts to provide accurate and balanced information about the banking system's reliability and access to currency will be important to consumer decision making. The consensus of the Gallup findings is that the job being done by the banking industry is being done correctly. It just is not yet complete.

Copyright © 1999 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 9, No. 5, 6/99