U.K. banks face a day of disaster today, as part of a simulation led by the Financial Services Authority to test firms’ responses to a cyber-attack on payment systems and travel chaos during the London 2012 Olympic Games.
The FSA was to contact 87 firms, beginning the exercise at 8 a.m. The drill includes a simulated computer-hacking attack on the financial system which disrupts communications and Internet access as well as wholesale- and retail-payment systems. The FSA also tested banks’ ability to deal with travel disruptions that leave employees unable to get to work. The Bank of England and U.K. Treasury also took part.
“There are no passes or fails,” the watchdog said in an e-mailed statement ahead of the tests. “The exercise is about firms assessing their business continuity systems and updating them where necessary and the authorities identifying areas for further attention.”
Five thousand bank employees battled against imaginary floods, “structural damage to office buildings” and “flying debris,” as part of the FSA’s 2009 exercise, according to the watchdog’s report on the results in February 2010. The regulator examined lenders’ emergency plans to handle severe weather conditions leading to power, travel and communication outages.
The watchdog will publish a report in February on how well firms perform in today’s test.
“The market-wide exercise is carried out to assess and improve the resilience of the financial services sector during a major operational disruption and is an important part of planning,” the FSA said.
This year’s test looks at how banks would cope with automatic teller machines running out of currency because the vans carrying the cash were stuck in heavy traffic as a result of the Olympic Games scheduled for the summer.
Hacking attacks will leave fictional consumers with debit cards failing to process transactions as part of a parallel scenario, an FSA spokesman said.
The FSA, which wants the tests to be as realistic as possible, in 2009 detailed a scenario of winds gusting at 70 miles per hour combined with 40 millimeters (1.57 inches) of rain.
In 2006, a hypothetical six-week flu epidemic tested firms’ ability to cope with large-scale staff absences.