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Financial services firms face flu pandemic -- on paper

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  • Financial services firms face flu pandemic -- on paper

    Financial services firms face flu pandemic -- on paper
    Massive planning exercise will assess impact on staffing, telecommunications

    Computerworld covers a range of technology topics, with a focus on these core areas of IT: Windows, Mobile, Apple/enterprise, Office and productivity suites, collaboration, web browsers and blockchain, as well as relevant information about companies such as Microsoft, Apple and Google.


    August 28, 2007 (Computerworld) -- What may be the largest pandemic planning exercise ever conducted in the U.S. is set to begin next month. The dry run will force financial services firms to operate with shrinking numbers of employees -- on paper, at least.

    More than 1,800 organizations have signed up to participate in the three-week simulation, which is being sponsored by the U.S. Department of the Treasury and the Securities Industry and Financial Markets Association.

    The exercise will also cover telecommunications issues. But it won't cause any service disruptions, such as long lines at ATMs or problems reaching online banking sites. Instead, participants will gather in conference rooms and assess how their businesses would be affected if a bird flu outbreak or other pandemic resulted in major reductions in the number of available employees.

    Jim Binder, a spokesman for The Operations Clearing Corp., said the Chicago-based provider of derivatives clearing and settlement services will have 30 to 40 workers involved in the planning exercise. The full details of how the simulation will unfold are being kept secret until it starts Sept. 24, Binder said.

    But, he added, the program will follow a compressed time frame that simulates the impact of a 12-week pandemic wave. Participants will be given information on how many absentee employees they can expect. Companies won't know exactly how hard they will be hit with sick calls from employees until this data is made available, Binder said.

    In addition, participating companies won't be able to pick and choose the level of workforce reductions they get hit by. Binder said some effort will be made to randomize the process, possibly by forcing companies to function without employees whose last names begin with certain letters.

    The test is based on a similar exercise conducted last fall in the U.K. by the Financial Services Authority (FSA), an independent body that regulates the financial services industry there. The U.K. simulation used employee absenteeism levels that began at 15% at the onset of the pandemic and then reached as high as 60% in some business units.

    In a report (download PDF), the FSA said the exercise showed that some banks would be forced to close branches and reduce banking services, including ATMs. According to the FSA, the test also raised questions about whether the U.K.'s telecommunications infrastructure would be able to support large-scale teleworking for a prolonged period as staff shortages eroded the maintenance capabilities of service providers.

    Telecommunications vendors will participate in the U.S. exercise, Binder said. The simulation will be jointly conducted by the Financial Banking Information Infrastructure Committee, which is chartered by the White House to improve coordination among financial regulators, and the Financial Services Sector Coordinating Council, a Chicago-based association of major financial services firms and trade groups.

  • #2
    Re: Financial services firms face flu pandemic -- on paper

    Pandemic test undertaken by financial services paints dire scenario
    Financial services firms used 'paper planning' to assess, improve pandemic plans


    Computerworld covers a range of technology topics, with a focus on these core areas of IT: Windows, Mobile, Apple/enterprise, Office and productivity suites, collaboration, web browsers and blockchain, as well as relevant information about companies such as Microsoft, Apple and Google.


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    October 24, 2007 (Computerworld) -- If a pandemic strikes the U.S., it will kill about 1.7 million people, hospitalize 9 million, exhaust antiviral medications and reduce basic food supplies, according to a planning scenario developed by financial service firms preparing for such a catastrophe.

    This particular disaster occurred only on paper. But those grim numbers are some of the pandemic planning assumptions used by nearly 3,000 banks, insurance companies and security firms in a just-concluded, three-week, paper-based exercise that may have been the largest pandemic test of its kind.

    In each week of this drill, participants -- some 10,000 people were involved -- received an updated scenario and were asked to assess their capability to deliver services as the pandemic deepened and then abated.

    "We wanted to look at the impact a pandemic can have on our sector," said George Hender, chairman of the Financial Services Coordinating Council, in a teleconference Wednesday. "One of the things that we tried to do is put some real stress on the firms."

    During the height of the pandemic, which was estimated to occur midway through the scenario, participants were asked to consider operating with an absentee rate of nearly 50% -- above the 35% to 40% rate federal officials believe may actually happen, said Hender. "We deliberately took the rate up much higher to see where their stress points were," he said.

    The financial services groups are now sharing the pandemic flu exercise information, and all the scenarios are available for download.

    The U.S. Department of Treasury is also a sponsor of the test, and Valerie Abend, deputy assistant secretary for critical infrastructure protection and compliance at the department, said the financial services industry has been "thinking long and hard about a pandemic."

    "We are one of the most prepared, I would argue, if not the most prepared of the critical infrastructures that are out there," said Abend.

    But the financial services firms won't really know how prepared they are until the end of the year. The thousands of pages of data collected during the test, which began in the last week of September, are still being analyzed and a final report is due at year's end. But based on some preliminary feedback from participants, the financial service firms weren't handing out too many gold stars for readiness.

    When asked "based on the lessons learned from the exercise, how effective are your organization's business continuity plans for a pandemic," 56% answered "moderately," the next highest group was "minimally," at 28%. Only 12% said their business continuity planning was very effective.

    The three-week scenario compresses the 12-week period a pandemic wave would likely last. Among the other things that may happen in an actual pandemic are school closings, as well as blackouts or brownouts in major metro areas because of degraded service as a result of absenteeism. Internet service throughput could be reduced by 50% due to congestion, and Web browsing timeouts would become common. Airlines would cut schedules, and garbage would pile up on streets.

    Many frustrations would arise. Working ATMs might be scarce, and call centers may not have enough staff to help. Health insurance claim volume would rise 20%. Auto claims are expected to fall 10%, since there would be less traffic on the road. But for those who are driving, gas prices would be high and fuel supplies reduced.

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    • #3
      Re: Financial services firms face flu pandemic -- on paper

      Thank you AnneZ!

      "... pandemic planning assumptions used by nearly 3,000 banks, insurance companies and security firms ..."

      When the banks and the insurances saids, than we can count that better will not be...

      "... blackouts or brownouts in major metro areas because of degraded service as a result of absenteeism. Internet service throughput could be reduced by 50% due to congestion, and Web browsing timeouts would become common. Airlines would cut schedules, and garbage would pile up on streets.
      Many frustrations would arise. Working ATMs might be scarce, and call centers may not have enough staff to help. Health insurance claim volume would rise 20% ..."

      _____
      "October 24, 2007 (Computerworld) -- If a pandemic strikes the U.S., it will kill about 1.7 million people, hospitalize 9 million, exhaust antiviral medications and reduce basic food supplies, according to a planning scenario developed by financial service firms preparing for such a catastrophe."

      And this is the result of a presumption of ~2%CFR!
      Why not 2 pandemic test scenarios: the other with higher (10-50)%CFR?

      _____
      "The thousands of pages of data collected during the test, which began in the last week of September, are still being analyzed and a final report is due at year's end."

      We can (not) sleep peacefuly for 2 months, no pandemic will happen during the report analisis timeline (can it be shorter?).

      Comment


      • #4
        Re: Financial services firms face flu pandemic -- on paper

        How Well Can Wall Street Handle Pandemic Flu? Drill Results Are Mixed?

        With bird flu outbreaks cropping up from Europe to Asia, scientists say the new pattern of spreading infection makes a worldwide human pandemic more likely. So how well prepared are U.S. financial firms for a pandemic?

        Well, 2,775 financial firms recently took part in a drill to try and answer that very question.

        The U.S. Treasury, together with SIFMA and the Financial and Banking Information Infrastructure Committee (FBIIC) held a 3-week pandemic drill for the financial services industry, giving enough time to simulate a full pandemic wave and clarify its ripple effects within the markets and interdependent sectors.


        Preliminary results of the three-week long exercise were mixed.
        While 63.9% of respondents said they had a business continuity plan, 56.2% said their plan was only moderately effective during the drill.
        "This could be anything ? a problem with procedures, or communication," suggests Steve Crow, Head of U.S. Sales for the Trading Systems business within BT Global Financial Services.


        Meanwhile, 28% of firms said their plan was minimally effective and 3.8% found that their plan was not at all effective.
        Still, 96.9% said the exercise allowed their organization to identify critical dependencies, gaps, and seams that warrant additional attention.
        91.1% said they would make additional refinements to their plans based on lessons learned.


        When asked what steps their organizations were taking to ensure they are meeting business and regulatory obligations during the height of the pandemic, 54.5% said establish work at home capabilities and 40.8% said divide units and disperse.


        "There are two or three scenarios where you really need to have good business continuity," says Crow.


        "There's the pandemic type, with lots of sick people working from home from silos, without coming into the office. You also have the situation of a steam pipe blowing up on Lexington and people not being able to get into the building."
        In big disasters, financial communities come together, Crow adds. "But if it's just you or your building, others don't feel the need to help you out. They tend to descend on you like a band of rabid dogs and try to eat your dogs."
        People must think, "Do we have an alternate site? And who are the important people in the company who should go there if there is a disaster? If you have 1000 traders but only 650 recovery desks, who will go?"

        Since last July's steam pipe explosion in New York City, interest in business continuity has spiked, Crow says.


        He says demand has risen for BT's virtual trading platforms, such as the ITS Anywhere for Web, a web-browser based turret that provides traders with voice connectivity away from the trading floor.

        Comment


        • #5
          Re: Financial services firms face flu pandemic -- on paper

          <TABLE class=tborder id=post110444 style="WIDTH: 532px; HEIGHT: 688px" cellSpacing=1 cellPadding=6 width=532 align=center border=0><TBODY><TR><TD class=thead>Today, 01:50 AM <!-- / status icon and date -->


          </TD></TR><TR><TD class=alt2 style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; PADDING-BOTTOM: 0px; PADDING-TOP: 0px"><!-- user info --><TABLE cellSpacing=6 cellPadding=0 width="100&#37;" border=0><TBODY><TR><TD class=alt2></TD><TD noWrap>Theresa42 <SCRIPT type=text/javascript> vbmenu_register("postmenu_110444", true); </SCRIPT>
          Senior Moderator


          </TD><TD width="100%"></TD><TD vAlign=top noWrap>Join Date: Feb 2006
          Posts: 4,601




          </TD></TR></TBODY></TABLE><!-- / user info --></TD></TR><TR><TD class=alt1 id=td_post_110444><!-- message, attachments, sig --><!-- icon and title --> "Half of Norway can die in a pandemic"
          <HR style="COLOR: #cccccc" SIZE=1><!-- / icon and title --><!-- message -->Via urdar on FW (hat-tip, urdar!): Quote:
          <TABLE cellSpacing=0 cellPadding=6 width="100%" border=0><TBODY><TR><TD class=alt2 style="BORDER-RIGHT: 1px inset; BORDER-TOP: 1px inset; BORDER-LEFT: 1px inset; BORDER-BOTTOM: 1px inset">Originally Posted by urdar (on FW)
          Norweigan scientist and member of national pandemic comitte Olav Albert Christophersen is critisising government for underestimating the danger.

          "Spanish flu" is not considered worst case scenario anymore, It could be much worce, half the population could die based on what we know about H5N1 in Indonesia and Egypt. The plans must be based on this, and not a milder scenario than spanish flu. We now have airtransport and hughe city populations, this will make things worce.

          He is cowriter on a report with John Fredrik Moxnes, scientist at the Defence institute of science to be published in "Microbial Ecology in Health and Disease".

          http://www.newfluwiki2.com/showComme...ommentId=73933


          </TD></TR></TBODY></TABLE>
          Halve Norge kan d&#248; i en pandemi
          http://www.dagsavisen.no/innenriks/article322198.ece [<< article in Norwegian]
          <!-- / message --><!-- sig -->__________________
          ...when you have eliminated the impossible, whatever remains, however improbable, must be the truth. - Sherlock Holmes


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