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minimum balances, or charges for transactions. In fact, until
shortly before decedent's death, Peoples provided checking
account customers with free printed blank checks; even after
Peoples decided to charge for checks, it charged customers only
for actual printing costs with no markup. As a result of
Peoples' generous checking account policy, there were
approximately 4,000 checking accounts open at Peoples on the
valuation date; however, approximately 1,200 of those accounts
had an average daily balance of less than $200 and total checking
account deposits amounted only to approximately $1 million. As a
result, most checking accounts were unprofitable for Peoples,
inasmuch as the costs of servicing the accounts exceeded earnings
on the deposits.
b. Savings Accounts
On the valuation date, Peoples had $7 to $8 million in
deposits in savings accounts.
c. Certificates of Deposit
The overwhelming majority of Peoples' deposits were
attributable to certificates of deposit. Those deposits included
"hot money", large deposits that come from a wide geographic area
in search of the best interest rate. Hot money is a volatile
source of deposits because it is likely to be withdrawn anytime a
better interest rate is being offered by another depository
institution. Peoples was not interested in pursuing or retaining
hot money, because, as discussed infra, it did not have
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