Monday, May 27, 2024

Treasurer Schroder assures public of state funding’s security

by BIZ Magazine

To quell any unease Louisiana citizens may have regarding the state’s finances in light of the banking collapse in California last week, State Treasurer John M. Schroder released the following statement:

“The money belonging to Louisiana taxpayers is safe. Treasury has no exposure to the banks that have been in the news this week. We monitor our bank accounts daily, keeping only enough cash to cover our daily transactions. We are a very conservative steward of the State’s fiscal assets.”

Louisiana’s primary bank is JP Morgan Chase, which has over $3.3 trillion in assets, and over $302 billion in capital. The bank conducts supervisory stress testing to ensure it is sufficiently capitalized to absorb losses during adverse conditions. Its fortress balance sheet principles are designed so that the firm can continue to serve clients and customers during uncertain times.

“I’ve been getting lots of questions from people who are nervous,” Schroder said. “I want to reassure everyone that our state’s finances are not susceptible to negative fallout from Silicon Valley Bank’s shutdown.”

He added that Louisiana invests the great majority of its cash in very short-term, liquid investments made up of Treasuries and Agencies.

On Friday, March 10, it was reported that the Federal Deposit Insurance Corporation (FDIC) shuttered Silicon Valley Bank (SVB) and seized its deposits in the second-largest bank collapse in U.S. history, fueling much of the recent public anxiety.

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