As in much of the banking industry, getting the word out on Y2K readiness has been a way of life at the Federal Reserve for the past year. During 1999, staff members and officials from throughout the Fed System have participated in hundreds of outreach activities, including public and industry forums, media events and congressional briefings. The continual progress in Y2K preparations, testing and contingency planning has enabled the financial industry and its regulators to report a steady stream of good news.
These communications efforts have paid off. A November report on a Gallup poll sponsored by the Fed and the FDIC indicates that nine out of 10 U.S. bank customers believe that their banks are ready for the Year 2000. Of those surveyed, nearly 70 percent report that they are receiving Y2K-related information from their financial institutions. Most important, the survey also reveals that only 39 percent of the respondents plan to withdraw extra cash prior to the New Year—down from 62 percent in March.
The Gallup results underscore the tremendous effort that the financial industry has made to communicate Y2K readiness. But while public confidence is moving in the right direction, the task is not quite finished. Fed Gov. Edward W. Kelley Jr. has said that we face two challenges related to the Y2K problem-preparing our technical systems and gaining public confidence. With 99.9 percent of all U.S. depository institutions deemed ready, it appears we have mastered the technical hurdle. The Gallup survey indicates weave turned the corner on public confidence as well. But public confidence can change quickly, especially if rumors and speculation go unchecked.
To combat Y2K misinformation, I encourage financial institutions to build upon the relationships they have established thus far and continue to talk to their customers. The Fed intends to maintain Y2K communications well into the New Year. Public Affairs staff at each Reserve Bank and at the Board of Governors will stand ready to provide information on the health of the payments system to the public and the press throughout the rollover weekend. While we do not expect to report on major problems New Year's weekend, we are prepared to accomplish what each of us has been working toward this past year-meeting the challenge of public confidence.
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Fed in Print: An index of the economic research conducted by the Fed.