BOT Orders Banks, Financial Institutions To Prepare For Disease Outbreak

[george]

Bank of Thailand orders financial institutions to prepare for disease outbreak

BANGKOK: -- The Bank of Thailand (BoT) has asked commercial banks and financial institutions across the country to develop their own contingency plans to cope with the risk of disease outbreaks that may affect the financial sector.

In a circular, the Bank of Thailand ordered all commercial banks and financial institutions to draw up a plan to enable businesses to operate in the event of an outbreak such as influenza, and the human-to-human transmission of avian flu.

One of the key objectives of the exercise according to the central bank is to ensure that any disease outbreak would pose no threat to the functioning of the country's banking and financial service system.

Among the questions that banks and financial institutions must address in the outbreak contingency plan exercise includes how to carry on delivering services and how outbreaks impact the well-being of their staff, together with other preventive measures and responses.

In drawing up the plan, the banks and financial institutions are also asked to assess the risk of disease outbreak on their operations and to plan how to cope with possible consequences such as defaulting on loans, a liquidity crunch and soaring demand for credits, particularly in vulnerable sectors such as agriculture, tourism and the service industries.

-- TNA 2008-04-16

[Scott]

Where did this come from? Why is it in the news? Don't they have contingency plans for things like disasters (human and otherwise)?

This is somewhat disconcerting and I wonder what prompted it.

[Boater]

Further to the post by Scott, the goverment should already have a plan in place for this kind of emergency.......

Again, this is not normally public knowledge either? unless the goverment has forgotten or hasnt put such a plan to place..... maybe it has been sitting on someones desk for 10 years, and they have had the attitude of ' I will do it tomorrow '

But it is quiet alarming they would mention this as the way they are doing... is this just someone being stupid as normal in the PR department or is this a soft warning of things to come very soon?

[Pushit]

Bank of Thailand orders financial institutions to prepare for disease outbreak

BANGKOK: -- The Bank of Thailand (BoT) has asked commercial banks and financial institutions across the country to develop their own contingency plans to cope with the risk of disease outbreaks that may affect the financial sector.

In a circular, the Bank of Thailand ordered all commercial banks and financial institutions to draw up a plan to enable businesses to operate in the event of an outbreak such as influenza, and the human-to-human transmission of avian flu.

One of the key objectives of the exercise according to the central bank is to ensure that any disease outbreak would pose no threat to the functioning of the country's banking and financial service system.

Among the questions that banks and financial institutions must address in the outbreak contingency plan exercise includes how to carry on delivering services and how outbreaks impact the well-being of their staff, together with other preventive measures and responses.

In drawing up the plan, the banks and financial institutions are also asked to assess the risk of disease outbreak on their operations and to plan how to cope with possible consequences such as defaulting on loans, a liquidity crunch and soaring demand for credits, particularly in vulnerable sectors such as agriculture, tourism and the service industries.

-- TNA 2008-04-16

Common risk management, this statement is amateurish; risk management assessment is a professional obligation to be performed Before financial commitments are entered into.

[Thai at Heart]

Bank of Thailand orders financial institutions to prepare for disease outbreak

BANGKOK: -- The Bank of Thailand (BoT) has asked commercial banks and financial institutions across the country to develop their own contingency plans to cope with the risk of disease outbreaks that may affect the financial sector.

In a circular, the Bank of Thailand ordered all commercial banks and financial institutions to draw up a plan to enable businesses to operate in the event of an outbreak such as influenza, and the human-to-human transmission of avian flu.

One of the key objectives of the exercise according to the central bank is to ensure that any disease outbreak would pose no threat to the functioning of the country's banking and financial service system.

Among the questions that banks and financial institutions must address in the outbreak contingency plan exercise includes how to carry on delivering services and how outbreaks impact the well-being of their staff, together with other preventive measures and responses.

In drawing up the plan, the banks and financial institutions are also asked to assess the risk of disease outbreak on their operations and to plan how to cope with possible consequences such as defaulting on loans, a liquidity crunch and soaring demand for credits, particularly in vulnerable sectors such as agriculture, tourism and the service industries.

-- TNA 2008-04-16

Why on earth is this in the news? Contingency planning for this should be normal business.

Out of curiosity, does this include planning for such potential financial disasters as coups and rigged or snap elections?

[plachon]

Bank of Thailand orders financial institutions to prepare for disease outbreak

BANGKOK: -- The Bank of Thailand (BoT) has asked commercial banks and financial institutions across the country to develop their own contingency plans to cope with the risk of disease outbreaks that may affect the financial sector.

In a circular, the Bank of Thailand ordered all commercial banks and financial institutions to draw up a plan to enable businesses to operate in the event of an outbreak such as influenza, and the human-to-human transmission of avian flu.

One of the key objectives of the exercise according to the central bank is to ensure that any disease outbreak would pose no threat to the functioning of the country's banking and financial service system.

Among the questions that banks and financial institutions must address in the outbreak contingency plan exercise includes how to carry on delivering services and how outbreaks impact the well-being of their staff, together with other preventive measures and responses.

In drawing up the plan, the banks and financial institutions are also asked to assess the risk of disease outbreak on their operations and to plan how to cope with possible consequences such as defaulting on loans, a liquidity crunch and soaring demand for credits, particularly in vulnerable sectors such as agriculture, tourism and the service industries.

-- TNA 2008-04-16

Ah, but it gives a good excuse to blame any downturn in the economy and credit crunch on the flu, rather than any mismanagement on the part of the people who run the show. Then blame the flu on those dam_n foreign birds flying around and you're sorted. Just like last time - blame George Soros and Raxesh Saxena for the 97 crash - and everyone else was faultless. Neat, huh?

[Martin]

Since the Western world's banks are in such disarray because the latest generation have been so cavalier as regards risk assessment, it seems natural that the BoT will worry as to whether the commercial banks here, particularly the smaller ones, have done their "What if?" planning on the administrative side, as well as on the managerial/financial one.

Who was it who first observed that MBA seemed to mean "Moral Bankruptcy Assured"?

I first heard it said nearly twenty years ago, in a Singapore university.

In previous generations to then, it used to be able to be taken for granted that the ethics of taking on the responsibilities of being a Deposit Acceptor would be adhered to. But that was in a different day and age, when banking services employed only a few people, and the modern mantra of "Greed is Good" was unthinkable.

The return to robust regulation of banking practices is clearly necessary and Central Banks should be checking that appropriate risk assessing and contingency planning has been done in all matters in all places.

Otherwise there could be a rapid, paralyzing loss of confidence on the part of the public, and of them looking for the return OF their captal, not merely for a return ON capital.

It wouldn't take much in these days of mass, instant communications for an outbreak of belief that Nick Leeson and Northern Rock weren't just 'blips', but harbingers. The result would be horrendous for the urbanised parts of societies.

Anything that the BoT does to indicate that it is 'on the ball' in checking that the country's commercial banks will always be able to function administratively, as well as financially, is to be applauded.

Edited April 16, 2008 by Martin

[Seneque]

Title should be read as :

Bank of Thailand orders financial institutions to prepare for FINANCIAL disease outbreak

[geriatrickid]

In fairness, Governor of The Bank of Canada along with Exchequer in the the UK made the same type of announcement a few weeks ago but they appeared as reassurance statements. You will find many custodians of the financial systems are following suit. If you check the US Fed Reserve website, you will also see a similar advisory, albeit in a different form.

[Cuban]

Where did this come from? Why is it in the news? Don't they have contingency plans for things like disasters (human and otherwise)? This is somewhat disconcerting and I wonder what prompted it.

As the rest of the organized world has been preparing for such an event for a few years now (picked up greatly after 9/11), I would speculate that a high up Thai manager read something from one of the many farang Disaster Recovery companies, looked around him and suddenly woke up.

Before moving to Thailand I was involved in this sort of planning and it is very interesting when you start digging under the surface seeing and assessing the risks.

Having applied the same DR risk assessment to my Thai business it is a little scary to see how thin the protection is(was!). But roll this out across the country and there is a lot of work that could be done - whether it will be is another question.

If pandemic does hit Thailand controlling movement of people could be a measure that the government offer up - similar to the SARS screening in Singapore in the late 90s.

Like many things it would be done the Thai way - so probably not best practice.

When I looked at this element of risk and how it would affect the business - I came to the conclusion that the biggest risk factor was food from street vendors. Not the food itself but the close contact hand to hand touching many people during the day and the use of shared plates etc. (Discos, movie theaters and dare I say bars.) Difficult to instruct(enforce) new eating habits - but the loss of staff (illness) is the biggest impact in the event of pandemic.

If the animal-human vector is ducks (latest popular guess I believe), then expect the price of shrimp/pork to rocket as it did last time the chickens were killed.

Do you have a stock of the blue alcohol for wiping things down? (We do!)

[astral]

Where did this come from? Why is it in the news?

Don't they have contingency plans for things like disasters (human and otherwise)?

Probably not.

Remember the philosophy that "this is Thailand and we are different from the rest of the world..."