DES MOINES, IA (01/13/2016)(readMedia)-- State Treasurer Michael L. Fitzgerald announced that, as a result of Tuesday's online auction, $50 million will be deposited in 12 banks across the state. The state will receive an average rate of return of 0.97% on these six-month certificates of deposit. "Over 40 banks participated in our first auction of 2016," Fitzgerald said. "Competitive bidding pushed the rate to the highest level in seven years. This reflects positively on the state of our economy going into the new year."
Fitzgerald created the Invest in Iowa program in 1983 as a way to deposit state funds in Iowa financial institutions. The treasurer's office uses an auction format offering state deposits to Iowa banks six times a year, which allows the state to earn a competitive return on the funds while ensuring local banks have the money they need to keep the economy moving. The financial institutions hold the funds as CDs and use the money to make loans. Currently, the Invest in Iowa program has over $276 million invested in Iowa banks.
"The total amount of money bid by banks has more than doubled in the last five years," Fitzgerald said. "We continue to see growing demand for the program. I am glad it is available to help facilitate lending around the state."
Invest in Iowa quarterly auctions are held on the second Tuesday of January, April, July and October. In response to growing interest in this program, two auctions offering one-year term CDs are also held throughout the year. The next auction is scheduled for February 23, 2016 at 10 a.m and will offer one-year term CDs. Each auction has an established minimum interest rate and a minimum bid. To learn more about the Invest in Iowa program, visit IowaTreasurer.gov, select "Invest in Iowa" under the "For Businesses" tab or contact the treasurer's office at 515-281-5368.
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