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Banks Are Required to Prepare for Disasters
Federal and state banking regulators require financial institutions to develop and test "disaster recovery" and "business continuity plans." Each plan must spell out how the bank will recover data, ensure the availability of cash, continue customer service, and otherwise function efficiently after a wide-ranging disaster — one in which personnel are unavailable, key facilities are closed, and power and phones are out for an extended period.
According to Michael Jackson, an Associate Director of the FDIC's Division of Supervision and Consumer Protection, the terrorist attacks on September 11, 2001, and the recent devastation from Hurricanes Katrina and Rita reminded the financial industry and its regulators "that you must be ready for a disaster of any magnitude or duration — you cannot plan for something small or brief."
"Banking institutions play a vital role in supporting the economy, businesses and individual families after a disaster," added Kathryn Weatherby, an Examination Specialist for the FDIC. "It's in everyone's best interest that banks bounce back quickly and that disruptions are minimized."
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