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Article: Bonanza for banks: Investors flee the stock market, park cash in local banks. (Year-End Wrap Up).(Brief Article)
- Article from:
- Fairfield County Business Journal
- Article date:
- December 31, 2001
- Author:
CopyrightCOPYRIGHT 2001 Westfair Communications, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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The banking industry had a curious mixture of a very good and just a, well, good year, with many banks reporting an unexpected flood of deposits as investors fled the stock market, but a bit of a squeeze on profits as interest rates on variable rate and other loans fell faster than rates on customers' deposits did.
"People who had previously been in the stock market moved their money to the banks even though all the rates in the banks had fallen," said Jay Forgotson, president and chief executive officer at Cornerstone Bank in Norwalk, of the incoming flood of cash. "They decided it made more sense to have money in the banks at low rates than to have negative ...