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A Chicago banker has warned that his bank could be 100% compliant and still suffer "problems" if other banks do not get compliant. He did not elaborate on the extent of these problems. This is the problem of shared data -- one of the black hole issues of the Millennium Bug.
Then there are vendors who supply the software. What if they are not compliant and go out of business?
Notice the stats for First Chicago Bank. From early 1995 until November, 1997, coders got 15% of the applications repaired. In the final two months of 1997, the bank expects to get to 40%. The code will be ready for testing at the end of 1998.
This story appeared in the Chicago TRIBUNE (Nov. 19).
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Jack Schaffer, commissioner of the Illinois Office of Banks and Real Estate, said he believes most of the state's banks "may be ahead of the curve.'' . . .
Schaffer said he is "more concerned about computer-service companies and vendors'' whose equipment might not be up to date. Some of those firms, he added, might go out of business in 2000.
Executives in charge of the conversion efforts at Chicago's largest banks say their programs are on schedule. But, like Schaffer, they are concerned about other parts of the chain.
"We could be 100 percent compliant, but one weak link in the system -- another bank, a vendor or a customer -- could cause problems,'' said Hollist of First Chicago, which figures it will spend $100 million for its own effort.
Among other large Chicago banks, Harris Bank has budgeted $50 million and its parent Bank of Montreal, $120 million; Northern Trust, $25 million; and ABN AMRO North America, parent of LaSalle Banks in Chicago, European American Bank in New York and Chicago Corp., more than $70 million.
Most of the big banks are also working with their smaller correspondent banks to bring the latter's systems up to date. But at least a third of the nation's smaller banks are either unaware of the problem or lagging in fixing computer problems, according to the U.S. comptroller of the currency, which regulates nationally chartered banks. . . .
The process of converting systems to be Year 2000 capable is a long and tedious affair. First Chicago, which began its planning in early 1995, has completed 88 applications, or 15 percent, so far and has "about 265 in process,'' Hollist said.
"We're on target to have 40 percent done by the end of this year and plan to be completed by the end of 1998 and spend all of 1999 testing the systems,'' he said.
"We're convinced we will be 100 percent ready,'' said Steve Kutnick, senior vice president of worldwide technology at Northern Trust. "This is a well-defined project. Our big concern is the other guy.''
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