Answers to Frequently Asked Questions on Year 2000 Business

99-CU-09 / May 1999
Answers to Frequently Asked Questions on Year 2000 Business
To
Federally Insured Credit Unions
Subject
Y2K
Status
Active
To
Federally Insured Credit Unions
Subj
Answers to Frequently Asked Questions on Year 2000 Business Resumption Contingency Planning

The Federal Financial Institutions Examination Council (FFIEC) recently issued a second question and answer paper on business resumption contingency planning, titled “Additional Questions and Answers Concerning Year 2000 Business Resumption Contingency Planning.” The purpose of the paper is to provide additional information on the business resumption contingency planning process, as well as to clarify the June 30, 1999, business contingency planning deadline. Enclosed is the paper.

Credit unions are required to complete a Business Resumption Contingency Plan (BRCP) by no later than June 30, 1999, (see NCUA Letter to Credit Unions 99-CU-1). As described in NCUA Letter to Credit Unions (LTCU) 98-CU-12, there are 4 phases to the development of a BRCP with validation of the plan being the final phase. The enclosed FFIEC publication recognizes that because of the dynamic nature of contingency planning, some institutions may need to execute tests of their BRCP during the 3rd and 4th quarters of 1999. NCUA agrees, and will allow testing of BRCP’s after June 30, 1999, in circumstances where it is warranted. Examiners will be reviewing BRCPs for appropriateness.

The enclosed paper also discusses the subject of “event planning.” NCUA considers event planning to be an optional step in business resumption contingency planning. As such, there is no completion milestone date for event planning.

Credit unions can review the criteria examiners will use when evaluating contingency planning by reviewing Section 5, of the Phase II Workprogram (see LTCU 98-CU-20 for a copy of the Phase II Workprogram). Additional guidance can be found in LTCU 99-CU-2, “Year 2000 Liquidity Planning.”

If you have questions or comments, please contact your examiner, regional office or state supervisory authority.

Sincerely,

___________/S/____________

Norman E. D’Amours

Chairman of the Board