Banking Association and CNB co-operate on smooth Y2K transition

The Banking Association, which groups virtually all the banks operating in the Czech Republic, and the Czech National Bank are co-operating closely in order to ensure a smooth transition of the Czech banking sector to the year 2000. At the moment of change into the new millennium, Banking Association member banks and the central bank will be in operational contact so that they can inform each other about the functioning of their information systems and together remove any negative effects of the Y2K computer problem. The CNB's special control centre and the relevant emergency workplaces of individual banks will be in operation around the clock from New Year's Eve 1999 up to 5 January 2000. Every effort has been made to ensure that, from the first working day of 2000, bank clients in the Czech Republic - both individuals and business clientele - can smoothly use the entire range of banking services and products.

In addition to the methodological aspects for dealing with the Y2K risk (required by a CNB regulation), numerous practical verifications have been carried out to ensure smooth transition of the domestic banking sector to the year 2000. These include demanding verifications by the external auditors of individual commercial banks.

The CNB supervisory authority has in the past months carried out a thorough check of the Y2K compliance of Czech banks and has declared the banking sector well prepared for the change from 1999 to 2000. Testing of interbank payment transactions, i.e. the links between the CNB clearing centre and individual commercial banks, has also proceeded satisfactorily.

The banks in the Banking Association have agreed further measures with the central bank. In particular, these include co-operation in verifying the functionality of their information systems in the first hours and days of the year 2000, on exchange of information on the state of their systems after the date change, and on scenarios for dealing with potential problems which cannot be ruled out even in the most advanced countries.

The public will find all the key information on the Y2K problem on the Internet sites of the Banking Association, the CNB and individual banks. The banks are also providing information to their clients via special telephone lines, brochures and leaflets.

The Banking Association and the CNB can, on the basis of reports from external auditors, the supervisory authority and individual banks, declare with authority that the Czech banking sector is prepared for the transition to the year 2000 in compliance with the standards effective in EU member states.

The Presidium of the Banking Association, Prague The Czech National Bank