Wall Street begins post-Sandy assessment
People were talking about business continuity and preparedness even before Sandy hit the New York area.
When the exchanges shut down for two days, the talking got a lot louder and grew debate more rancorous. At this point, it's too early to expect any significant industry-wide changes. Many people are still digging their way of the storm's destruction. But the discussion will have to take place sooner or later.
Finra has already launched a far-ranging review, according to the WSJ. That review is focusing on "which backup procedures financial firms activated in response to Sandy, whether critical operations failed, and any hiccups in dealing with exchanges or clearinghouses."
In the end, I would expect regulators to be heavily involved in the collective planning and testing. I also think the industry will institutionalize a philosophy that will aim to keep the markets running, even in the midst of a Sandy-like disaster. That the markets were shut down was seen by some pundits, including former SEC chairman Arthur Levitt, as a lapse.
I expect that during the next major event of this nature, people will remember the criticism and aim to keep the markets open. All in all, if the 9/11 attacks ignited a more aggressive continuity movement, Sandy will likely push the movement to the next level. I can only hope such plans are never needed.
- here's the article