How will compliant N. American banks interact with noncompliant banks around the world?

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I've seen G. North's answer to this question many times, but would also like to hear it from a banking programmer. As long as that less-than-100% compliant bank is in operation, is there any reasonably safe way the compliant bank can interact with it? If not, is it possible that large banks around the world are already discussing mergers to bail out the hopeless cases?

-- Bill Byars (billbyars@softwaresmith.com), January 17, 1999

Answers

Thanks to Mike Lang whose post below mine I didn't see. Maybe they were simultaneous. Other comments welcome.

-- Bill Byars (billbyars@softwaresmith.com), January 17, 1999.

I was a programmer at a bank for several years. Less than 100% won't cut it. Alan Greenspan said that 99% is not enough. He is correct. Banks that do manage to achieve 100% cannot deal with ones that are not completely ready, due to the risk of infection. The banking industry is probably the most globally integrated of all industries. Also, within a bank itself the applications are highly interfaced. At the one that I worked at there were data feeds between most of the applications. So there is a lot of potential risk, not only from inter-bank settlements but also from the high level of integration for the application systems within the bank itself. And you are right, the number of banks has been steadily decreasing. This began well before Y2K and is continung, with Y2K fueling as least part of the takeover frenzy.

-- Rob Michaels (sonofdust@net.com), January 17, 1999.

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