Tue, 04 Jan 2000

Local banks resume business with no sign of Y2K snafus

JAKARTA (JP): The country's banking industry began the first business day of 2000 with none of the feared computer glitches from the much-hyped Y2K bug.

The public went about its daily business with banks operating as normal on Monday after Bank Indonesia (BI) declared the banking sector had safely passed the rollover on Jan. 1

Ronald Waas, a member of the central bank's Y2K team, said BI had so far received no reports from banks of Y2K-related problems.

"Should nothing happen by tomorrow, we plan to close our Y2K post," Ronald said, adding that the post would continue to help banks deal with any millennium-bug problems until Jan. 17.

Interbank clearing activities at the central bank did fall sharply on Monday as many banks remained hesitant to conduct large transactions.

The head of BI's clearing section in Jakarta, Bramudija Hadinoto, said the value of the clearing plunged to Rp 3.6 trillion (US$514 million) from the usual Rp 21 trillion.

"On normal days we receive some 3,900 to 4,000 clearing forms instead of the 1,687 (we received) today," Bramudija said.

Aside from the drop in activity, the BI clearing section experienced no irregularities which might have been linked to the millennium bug, he said.

Separately, BI Deputy Governor Aulia Pohan said on Saturday that in the two weeks prior to January, the public had withdrawn some Rp 10.1 trillion from banks, or about twice as much compared to the same period last year.

He said the increase was less the result of fears of the Y2K bug than anticipation of the upcoming Christmas and Idul Fitri holidays.

The central bank increased its liquidity reserves by five times to Rp 95 trillion in December, anticipating a rush on banks brought on by Y2K-caused failures in the banking sector.

The Y2K problem, or the millennium bug, arose because older computer systems recorded dates using only the last two digits of the year. Such systems could have read "2000" as "1900", generating errors or system crashes when the date rolled over to Jan. 1, 2000.

The world spent billions of dollars updating computer systems and on consulting services, and many were taken aback that even countries deemed only moderately prepared for the bug, including Indonesia and Russia, have reported no problems.

Local private and state banks disclosed that on the first business day of 2000, banking activities were free of Y2K-related irregularities.

State Bank Negara Indonesia (BNI), which has some eight million customers, said there had been no reports of any Y2K problems at its 645 branches and 740 automatic teller machines across (ATMs) Indonesia.

BNI corporate secretary Sudirman said the bank had begun preparing for the bug in 1997 and had spent some Rp 35 billion making BNI Y2K compliant.

"Thanks god everything turned out well," a visibly relieved Sudirman said.

Bank Niaga, another local bank, went so far as to allow its ATMs to be tested on live TV shortly after midnight on Jan. 1. The bank passed with flying colors, to the collective joy of the bank's senior management.

Bank Niaga reported on Monday that as expected, all branch offices resumed operation with no Y2K computer glitches.

The spokesman for Bank Niaga's Y2K command post, Wahyu Eko Wardono, said: "Everything just went smoothly today."

He said the bank's 117 ATMs and 76 branch offices, 40 of which are located in Jakarta, were fully operational.

Bank Bali, which came under heavy pressure for a loan scandal last year, also reported its infrastructure was fully intact.

Bank Bali Y2K project manager Dharma Setiawan said he had received no reports of irregularities and concluded that business on Monday proceeded normally.

A statement from Bank Danamon Indonesia announced business as usual on Monday, but added that its Y2K posts would remain on standby 24 hours a day until Jan. 3.

The 69 branch offices and ATMs of Bank Universal proceeded with business on Monday with no reports of Y2K-related problems.

Bank Universal spokesman Herda Tradsmadji reported no irregularities in the bank's operation. He added that the bank planned to keep its Y2K posts open until Jan. 17 at the latest.

There was no comment from Indonesia's largest private bank, Bank Central Asia. (03)