Back in the summer of 2021, during an especially active hurricane season, the Federal Deposit Insurance Corporation’s FDITECH unit launched a program to speed development of digital capabilities to bolster the operational resilience of financial institutions during a natural disaster or other type of major disruption.
Because “the U.S. financial sector is facing a growing number of threats to its information technology systems, operations, people and facilities,” the FDIC said, institutions need “to respond to and recover from these disruptions in a timely, consistent and reliable manner.” The agency kicked off the initiative with a question for program participants to contemplate: “What would be the most helpful set of measures, data, tools or other capabilities for financial institutions…to use to determine and to test their operational resilience against a disruption?”
It’s a question banks would have been wise to ask themselves in advance of this year’s hurricane season, which as of early September was on pace to exceed the 12 to 17 named storms that the National Oceanic and Atmospheric Administrative (NOAA) predicted for the region this year. And that’s not including Hurricane Hilary’s unprecedented swamping of parts of Southern California and Mexico in August.
Even for businesses that weren’t impacted by Hurricane Hillary or the procession of storms in the Atlantic, the operational disruption that disasters like these can cause provides a powerful reminder of how crucial business continuity planning is, particularly for financial institutions. A network outage can render an organization practically invisible — not an acceptable outcome for banks whose customers (and employees) expect always-on, 24/7/365 network, application and account access.
In a 2021 report, ITIC found that for the vast ..
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