Weiss Rating works the numbers.
(If I recall correctly, this is not the first y2k survey conducted by Weiss. They had a similar problem with banks failing to respond to the last survey. It is unusual for an institution not to respond to a Weiss survey as the firm is highly regarded for its' safety ratings. And what to make of the discrepancy between the Weiss data and the fed data? Perhaps it is easier to be less than forthcoming with the govt. than lie to Weiss?)
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biz.yahoo.com
Wednesday February 10, 1:51 pm Eastern Time
Company Press Release
Over 30% of Banks Admit Missing Y2K Deadline, Contradicting Government
Assurances
PALM BEACH GARDENS, Fla.--(BUSINESS WIRE)--Feb. 10, 1999--Among banks and
S&Ls responding to a Weiss Y2K readiness survey mailed Dec. 30, 1998, a
surprisingly large percentage -- 32% -- admit that they missed a critical
Y2K deadline.
These institutions report that they did not complete remediation and
testing of internal mission-critical systems by Dec. 31, 1998. Furthermore,
20% do not anticipate completion until March. This implies a failure to
comply with the federal requirement that ''testing of internal
mission-critical systems should be substantially complete'' by Dec. 31,
1998. (a)
This finding directly contradicts recent assurances from banking regulators
that only 4% of banking institutions have been rated ''unsatisfactory'' or
''needs improvement.''
''I don't understand how the authorities can give 'satisfactory' Y2K
compliance ratings to institutions that have apparently missed a critical
compliance deadline,'' commented Martin Weiss, Ph.D., chairman of Weiss
Ratings, Inc. ''I personally believe the authorities are either using
outdated information in their pronouncements or simply sugar-coating the
truth. In the long run, I feel this can only damage their credibility and
create the conditions for the very consumer panic everyone wants to
avoid.''
To date, 909 banks and S&Ls have responded to the Weiss survey. Among
these, only 620 (68%) stated that they had completed the required Y2K fixes
on all internal mission-critical systems by Dec. 31, while 289 (32%)
reported that they had missed the deadline. Among these, 184 institutions
(20% of respondents) stated that they did not anticipate completing the
fixes until after Feb. 28.
Final results of the Weiss survey, with additional analysis, will be
released in early March.
''Furthermore,'' Weiss adds, ''we must assume that, on average,
institutions that did not respond to our survey are more likely to be late
in fixing their Y2K problems than those that did.''
Weiss urges consumers to write their Congressmen to require full and honest
disclosure from regulators regarding the current Y2K status of financial
institutions -- not only for banks and S&Ls, but also for insurers and
credit unions. Further, Weiss advocates full disclosure to consumers of the
official Y2K ratings issued to all banks and S&Ls by the regulators.
Currently, these ratings are deemed strictly confidential and are not
available to the public.
Until this information becomes public, the Weiss Y2K Ratings are the only
ratings of their kind that consumers can use to make informed decisions.
For $15 per company, consumers may call 800/289-9222 for ratings on their
bank, S&L, or insurer.
Weiss will provide a Weiss Y2K Rating for those institutions who have
responded to its surveys, plus a Weiss Safety Rating on virtually any
financial institution in the country.
Weiss Ratings Inc. issues financial safety grades on over 16,000 banks,
S&Ls, insurers, HMOs, Blue Cross / Blue Shield plans, and security
brokerage firms.
(a) The Federal Financial Institutions Examination Council (FFIEC), which
coordinates various banking regulators, including the Federal Reserve, the
Federal Deposit Insurance Corporation and the Office of Comptroller of the
Currency, clarified this requirement in an Aug. 28, 1998 email to bank
CEOs, entitled ''Year 2000 Questions And Answers,'' stating: ''The FDIC
expects each financial institution to meet the following key milestones in
the Year 2000 testing process by the date indicated: ... Dec. 31, 1998 --
testing of internal mission-critical systems should be substantially
complete.''
------------------------------------------------------------------------
Contact:
Weiss Ratings Inc.
by
Yui & Co.
Ellen Yui
301/270-8571
ellenyui@aol.com
or
Elizabeth Kelley Grace
561/989-9855
lizkg@aol.com |
