Most local banks ready for millennium bug

JAKARTA (JP): Most of the country's banks are ready to cope with the computer glitch in the new millennium, according to the latest assessment by the government-sponsored Y2K Task Force.

The Task Force said in its report made available to The Jakarta Post on Thursday that the country's banking sector is 95 percent Y2K compliant.

The report said Bank Indonesia (the central bank) had its information technology system remediated, supply chain management, embedded system management, communications and contingency plans checked, fixed and tested in October.

The central bank's electronic clearing system in Jakarta, which was developed in 1997 to cover about 87 percent of daily clearing volume in Indonesia, is Y2K compliant.

Bank Indonesia's facilities, which are ready for the millennium bug also include its automated clearing system, which is a paper-based clearing system using reader-sorter machines, in Jakarta, Surabaya and Medan, as well as its semi automated clearing system using stand alone PC's at all its branches, according to the report.

The Task Force report also said that at least 85 percent of the 167 commercial banks operated in Indonesia had reached their Y2K ready status by August.

The 141 Y2K ready banks include about 20 major banks, which are considered as highly dependent on computer systems and together hold about 93 percent of the market.

The report, however, does not provide the names of the banks.

The Indonesian Y2K Task Force is a government-sponsored institution established to supervise the Y2K anticipation programs run by the country's essential infrastructures, such as banking, telecommunications, energy and transportation.

In order to speed up and synchronize Y2K preparation with other commercial banks, Bank Indonesia is scheduled to run an industry-wide test on all banks later this month to check on the banks' final preparations as well as contingency plans to anticipate possible computer failure during the date rollover to Jan. 1, 2000.

Y2K refers to problems computerized systems will face at the turn of the century, when their two-digit-year counters fail to distinguish between 1900 and 2000.

The glitch may cause computers to shut down or fail to function properly. Power supplies may drop, telephones and transportation systems may stop operation and automated banking transactions may fail.

The United States-based Gartner Group, a Y2K-compliance monitoring body, said in a recent report Indonesia was among some 30 developing nations most prone to the Y2K problems with some 66 percent of businesses in the countries possibly affected.

Bank Indonesia has prepared the National Risk Mitigation and Contingency Preparation to anticipate any possible failure in computer systems.

Among the steps in the mitigation and contingency preparations are the establishment of a government blanket guarantee for depositories for the next six months, discount windows as the short term fund for helping banks in the condition of a mismatch and production of more bank notes to ensure a sufficient cash supply.

The bank recently said that it planned to impose a one-day holiday on Dec. 30 for banks to print all data as a backup in case of system failure. (cst)