The Democratic and Republican political conventions provided banks in the northeastern U.S. with an opportunity to test their business continuity and disaster recovery procedures. In Boston, the closure of subway stops, commuter rail stations and a major highway led to the eerie quiet of deserted streets rather than the expected tangled mess of conventioneers, protesters, police and commuters.
David Cotney, senior deputy commissioner, Massachusetts Division of Banks, likens banks' preparations for the DNCC to the run-up to Y2K. "The financial services industry was the best-prepared industry when we had the Y2K rollover," he says. "They're very experienced in terms of having contingency plans and backups."
Among the operational issues considered were employee access to facilities, restocking of ATMs, delivering cash to branches, delivering items to the Federal Reserve for collection and communicating closure information to bank customers.
New York's Turn
RNC convention planners aren't taking New York's turn in the spotlight any less seriously. The Department of Homeland Security "has communicated to the various sectors that they're taking extra security precautions," says John Carlson, senior director at BITS, the technology arm of the Financial Services Roundtable (Washington, D.C.).
For some firms, that means relocating staff to backup sites. "A number of firms are making plans to relocate staff in certain locations to their backup sites," Carlson says. Other firms have already moved their core operating facilities outside of the Northeast Corridor, as JPMorgan Chase (New York) did with its Tampa-based data center.
"One of our branches is fully capable of running the entire bank instead of the headquarters," says Dean Kenney, senior vice president and treasurer for Chart Bank (Waltham, Mass.; $225 million in assets). "We've had that setup for the past couple of years."
Chart Bank uses a Web-based application from Strohl Systems (King of Prussia, Pa.) to document the organization's disaster recovery procedures and provide employees with access to crisis-management resources. "The people who are authorized to do so can look and see exactly what they should be doing, no matter where they are," Kenney says.
Eventful or not, the conventions have spurred banks to revisit their business continuity plans. "We've had a huge boost in business from our Boston clients, to get their [disaster recovery] plans up to date - or in some cases, to sprint to get them done," says Michael Jennings, vice president of consulting, Strohl Systems.
The return on their investment, however, is difficult to calculate for banks. "Considering their reputation in the marketplace, their risk of losing clients, and some of those shareholder confidence issues, there's no number you can put on it," Jennings remarks.