Connecticut Banks Say They Are Ready For Y2K

NEW HAVEN, Conn. (AP) — The year 2000 computer glitch may cause some minor inconveniences when it comes to banking, but bank officials and others say there’s no need to worry about the status of your savings.

The worst Y2K problems most bank customers will likely encounter are errors on statements and other annoyances, regulators, bank officials and independent experts say.

The potential technology problem could crash older computers unable to recognize dates beyond 1999. The banking industry, faced with public anxiety and heavy pressure from the government, has led efforts to exterminate the bug.

Banks are now focused on reassuring consumers that their money is safe.

Automatic teller machine displays inform customers that the devices were tested for the glitch and cleared.

Some banks – including Citizens Bank and BankBoston – even plan to keep some branches open on New Year’s Day, just to put customers at ease.

“Banks are prepared better than almost all other industries,” said state Banking Commissioner John P. Burke.

All banks that do business in Connecticut meet state and federal standards for Year 2000 readiness, according to officials at the state Department of Banking.

The Y2K problem involves older computers that read only the last two digits of a year and could mistake the year 2000, or “00,” for 1900. Banks are particularly vulnerable to the glitch because of the volume of information they store and process on computers.

Among their thousands of functions, bank computers record transactions, track transfers, store account information, tabulate interest, calculate investment gains and in some cases even automatically lock and unlock vaults.

The fear that bank computers might fail ranks among the worst nightmares for many people. Even at a small bank, fixing the problem is a major and expensive undertaking.

Milford Bank, with three branches that handle about $166 million in annual deposits, has undergone tests for Y2K compliance.

“It worked. Thank God,” said Susan Shields, the bank’s vice president. “We expect to be ready. We expect our systems to function normally.”

The test culminated a three-year effort in which the bank had to inventory all systems that might be affected: hardware, software, even security systems and environmental control. Shields estimated the cost of preparations was in the “six figures.”

“It’s only a simulation, it’s not 100 percent,” Shields said. If there are problems, “I would suspect that they’re going to be more of an inconvenience.”

Still, Milford Bank has hired armed guards for New Year’s Eve and New Year’s Day, just in case electronic security measures don’t work. It will issue cellular telephones to employees, just in case there’s a regional service failure.

The bank also will make extra cash available for customers who want to hold their assets elsewhere, Shields said. Officials are considering stocking ATMs with $50 and $100 bills instead of the usual $20 bills, she said.

Bridgeport-based People’s Bank, with nearly $12 billion in managed assets and 128 branches, has had more than 50 people working on the problem at an estimated cost of up to $15 million.

Wendy G. Regets, vice president at People’s, said she’s confident all systems customers deal with directly will function as they’re supposed to.

“All of our customer contact systems have been Y2K-ready for quite some time now,” she said. “We’ve been testing and re-testing everything.”