Financial Update - Volume 19, Number 3 - New Booklet Teaches Bankers Lessons from Hurricane Katrina
Vol. 19, No. 3,
Third Quarter 2006
Publication received broad input
These lessons were the impetus for the development of a booklet, Lessons Learned from Hurricane Katrina: Preparing Your Institution for a Catastrophic Event, which conveys the experiences as well as the lessons learned in the aftermath of Katrina. Member agencies of the Federal Financial Institutions Examination Council (FFIEC), including the Federal Reserve System, as well as the Conference of State Bank Supervisors, developed the booklet.
Ensuring contingency plans
While financial institutions have long had disaster recovery and business continuity plans in place, circumstances have not forced them to put those plans to the test the way banks did in Florida, Louisiana, Mississippi, and Alabama during the ferocious 2005 hurricane season.
Though existing disaster recovery plans generally worked well, the unprecedented widespread disruptions of power and basic services in some cases far exceeded the scope of what many of this region's financial institutions expected. Some of the major hardships that institutions faced included
|||inadequate methods of locating missing employees when lines of communication were broken;|
|||absence of reliable transportation or access to transportation in restricted areas;|
|||computer systems failing because of lack of electricity or fuel for backup generators;|
|||disruption or destruction of physical facilities and automated teller machines; and|
|||long-term disruption of mail services in some areas.|
Gulf Coast financial institutions demonstrated impressive resiliency as well as creative problem solving in the face of Katrina's aftermath. This booklet catalogues those experiences to create a useful planning tool that is available electronically on the FFIEC Web site. All insured depository institutions will receive a copy of the booklet as well.