Bank Indonesia declares its readiness for millennium bug
Bank Indonesia declares its readiness for millennium bug
JAKARTA (JP): Bank Indonesia (BI) assured on Tuesday there
would be no glitches in domestic banking transactions in entering
the new millennium, but added it was armed with a contingency
plan just in case.
The central bank's deputy director of information technology,
Mulyana Sukarni, said the entire transaction system, including
on-line activities, was ready for the Year 2000 (Y2K) bug.
"We are sure that there will be no disruptions in clearing
activities when we enter the new year as all the existing
transaction systems are already 100 percent Y2K compliant," he
told a media briefing.
Mulyana said the central bank devised a contingency plan to
ensure that clearing activities would not be disrupted if the
existing system failed at the turn of the year.
He said the central bank would use the semiautomatic off-line
system, known as the "local" clearing system, in the event of a
system failure.
"The worst-case scenario would if the local system also could
not work. In that case, we would go back to manual procedures,
but we hope this would not happen," he said adding that the
manual system was not at all affected by the Y2K bug.
The Y2K bug refers to a theory based on older computer systems
recording dates using only the last two digits of the year. If
not corrected, such systems could treat "2000" as "1900",
generating errors or system crashes when the date rolls over to
Jan. 1, 2000.
Mulyana said that the success of the central bank -- as the
clearing agency for all banking transactions in the country -- in
beating the millennium bug would depend heavily on the
preparedness of the commercial banks.
He said that of the 167 banks in the country, 162 were 100
percent Y2K compliant.
"Five small banks are still working on their Y2K preparedness
and expected to be fully ready on Dec. 20," he said.
Mulyana said BI advised all banks to report to the central
bank prior to the end of the year on the status of their Y2K pre-
event management.
"They are advised to give reports on Dec. 14, Dec. 24, Dec. 27
and Dec. 31," he said.
In the report, each bank should describe the transactions of
its customers, as well as its counterparty banks and the bank's
liquidity position.
No holidays
The head of BI's Y2K Committee for Private Banks, Andreas E.
Susetyo, said there would be no extra holidays designated during
the Y2K transition period.
He said that clearing activities, as in the past, would be
closed on Dec. 31 in conjunction with the year-end book closing.
"Like in previous years, it will be a working day on Dec. 31
but there will be no clearing activities."
He said the central bank's employees in the information
technology department would continue to work on Jan. 1 and Jan.
2.
"These people will continuously monitor the system as the Y2K
transition period passes," he said.
Bank Indonesia will only settle interbank clearing for sums of
Rp 100 million and above on Dec. 30. Lower amounts would be
completed on the first working day of the new year, he added.
He said people could still withdraw cash from ATMs throughout
the Y2K transition period.
The country's capital market and its supporting institutions
previously also declared their preparedness for the millennium
bug.
Committee chairman Surdiyanto Suryodarmodjo said investors did
not have to worry about possible disruptions in stock trading
activities in the new year as trading systems at both the Jakarta
and Surabaya stock exchanges were 100 percent Y2K compliant.
The Indonesian Clearing and Settlement Agency (KPEI) also
achieved 100 percent Y2K compliance in its computerized clearing
system, he said.
Surdiyanto acknowledged that the Indonesian Central Securities
depository (KSEI) was not yet compliant, but he said that it
would not affect overall transactions because the institution
still used manual systems in daily operations.
He said two-thirds of the 186 securities companies completed
and passed a process of final testing for Y2K compliance. The
remaining one-third were declared free from possible Y2K effects
because they used manual and semimanual operating systems. (udi)