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Entering the Final Phase of Year 2000 Preparations
September 17, 1999
Bank of Japan
Financial institutions and operators of private-sector payment and settlement systems in Japan have given Year 2000 preparations top priority and have been working diligently for a smooth transition to the year 2000. They have renovated and tested their computer systems, and have been making Year 2000 contingency plans to be prepared for possible Year 2000-related disruptions.
The Bank of Japan has been working on its computer systems and basic facilities, including the BOJ-NET (an on-line settlement system for funds and JGBs), to make them Year 2000 compliant. At the same time, the Bank has been promoting the Year 2000 preparations of financial institutions by issuing guidance papers, monitoring their Year 2000 readiness and giving advice to support their preparations through on-site targeted examinations and off-site monitoring. As for payment and settlement systems, the Bank has conducted six external tests of the BOJ-NET with private-sector payment and settlement systems since last December.
This report provides information on the Year 2000 readiness of both individual financial institutions and payment and settlement systems as of mid-1999.1 It describes (i) the results of the Year 2000 readiness survey of financial institutions with current accounts at the Bank of Japan in July this year, (ii) the Year 2000 readiness of key payment and settlement systems in Japan, and (iii) the results of external tests the Bank carried out jointly with payment and settlement systems.
As explained in the report, the Year 2000 preparations of the financial industry in Japan are on track overall. With less than four months before the year 2000, the focus of the financial industry's preparations is shifting from system-related preparations, such as renovation and testing, to non-system-related preparations for the transition period. These include drawing up and refining contingency plans and conducting drills to test them, as well as making staffing arrangements for the year 2000 transition and building mechanisms for information exchange between the relevant parties. The Bank of Japan is making sure that it is thoroughly prepared for the transition to the year 2000 by closely cooperating with market participants, the government, government agencies and various industry associations.
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