Financial Services and Year 2000: No high impact reds
22/07/1999
In its latest assessment of financial institutions, the Financial Services Authority reports today that there are now no High Impact groups rated as Red compared to one at its previous report, and only two Medium Impact institutions are rated Red compared to seven previously. Since the previous report on 12 July, the proportion of High and Medium Impact firms rated as Amber has also reduced from 32% to 28%, while the proportion of those rated as Blue/Green has increased from 66% to 72%.
Commenting on these figures, Michael Foot, Managing Director of Financial Supervision at the FSA, said:
"The end of June was always seen as a key date for firms. This latest assessment shows a strong momentum towards Year 2000 readiness. It is particularly encouraging that we now have no High Impact and very few Medium Impact Reds. We are pleased with the response of firms to the intense supervisory oversight which we have applied in recent months. We will continue to exercise all our influence to promote continuing progress of firms into Blue/Green status over the next crucial months.
"Now is the time for senior management to ensure that their firm is fully committed to completing all outstanding work, including continuity planning, in good time. Firms must also be ready to explain to their customers and counterparties what they have done and are doing to give confidence of business as usual".
Notes for editors
There are about 150 financial groups in the High Impact category and 300 in the Medium Impact category.
According to today''s assessment, of High and Medium Impact firms:
10% are rated as Green - "done" all reasonable steps taken 62% as Blue - "on track" 28% as Amber - "behind but expected to catch up" 0.5% as Red (2 both medium) - "serious risk of material disruption"
The previous assessment of High and Medium Impact firms on 12 July was that:
6% were Green 60% were Blue 32% were Amber 2% (1 High Impact and 7 Medium Impact) were Red
The FSA''s assessment of firms'' Year 2000 preparedness is based on regular reports of their progress in remedying business critical systems and in preparing effective business continuity plans.
The primary responsibility for achieving Year 2000 compliance and effective business continuity rests with financial institutions themselves. Year 2000 is a regulatory issue because of its impact on depositor, investor and policy-holder protection; on prudential soundness of financial institutions; and market integrity. Promoting Year 2000 preparedness is a major FSA supervisory priority.
The FSA has a dedicated Year 2000 section on its web-site, which includes Publications, Speeches, Press Notices, and Guidance for supervisors and links to other Year 2000 sites. The URL is http://www.fsa.gov.uk/y2kcomp.htm.