Regulation and Compliance: HKMA tells banks to put Business Continuity Plans ready

As a Mexican arriving in Hong Kong carries the latest potential pandemic, HKMA, which led regulators in requiring the creation of business continuity plans to deal with outbreaks of illness during SARS, has told institutions to prepare for the possibility of a widespread outbreak of Human Swine Flu.

In a notice issued yesterday, HKMA said:

Further to the electronic mail to all authorised institutions (AIs) on 28 April 2009, I am writing to draw your attention to the escalation of the pandemic alert level from Phase 4 to 5 by the World Health Organisation and the need for individual AIs to step up their preparedness for a possible outbreak of the human swine influenza in Hong Kong.

In view of the increasing severity of the outbreak in other parts of the world, AIs are urged to implement their Business Continuity Plan (BCP) and put in place all necessary precautionary and contingency measures as soon as possible. A BCP team with sufficient authority and representatives from all key operational areas should now be established to monitor the implementation of these measures which should, among others, include:

(a) Reviewing the readiness of the BCP to ensure that the relevant emergency responses and contingency measures are ready for activation if needed.

(b) Checking whether the business recovery teams of the BCP and the contact information of responsible personnel, relevant external parties and major outside service providers are up-to-date.

(c) Ascertaining whether all the predefined precautionary measures and responses for the "Alert Response Level"1 have been put in place, including:

(i) maintaining a healthy work environment and environmental hygiene;

(ii) increasing staff awareness of influenza pandemic and communicating to staff the steps taken by your institution in preparation for the possible outbreak; and

(iii) establishing infection control procedures (e.g. acquisition of adequate personal protective equipment such as masks and disinfectants).

(d) Invoking the relevant emergency measures in response to the "Serious Response Level"1, including:

(i) checking and ensuring that sufficient equipment and devices are in place to support the activation of "work from home" and/or "split operations" strategies; and

(ii) ensuring that a clear command, control and communication structure for crisis management is established for effective monitoring of the latest developments of the situation.

AIs should also refer to the guidelines issued by the Centre for Health Protection of the Department of Health from time to time, and the guidance specified in the Hong Kong Monetary Authority's circulars and other relevant materials when implementing their emergency response and contingency measures for the pandemic.

The Hong Kong Monetary Authority will continue to monitor the development and issue further guidance to AIs where necessary.

Yours sincerely

Danny Leung
Acting Executive Director
(Banking Supervision)

1 The Government of the Hong Kong Special Administrative Region (HKSARG) has developed the Framework of Government's Preparedness Plan for Influenza Pandemic, which includes a three-level response system (Alert Response Level, Serious Response Level and Emergency Response Level) based on different risk-graded epidemiological scenarios. The HKSARG escalated the response level from "alert" to "serious" on 26 April 2009.