Weighing up counterparty risks
Black and white commitment
millennium
Uèii
ON
PM
II What'sNewS
It's all very well for the
Rabobank Group to be on
top of impending Y2K threats,
but what about our clients?
Naturally, the domino-effect of
our clients fading millennium
compliance has the potential
to inflict huge credit risk. At
least that was the motivation
behind the recent survey sent
to all Rl offices, the results of
which sketch a fairly accurate
picture of where our customers
stand, and how far they still
have to go to achieve Y2K
compliance. According to Bert
Sperna Weiland, millennium
coördinator global credit risk
management, in ternts of credit
risk awareness within our net-
work, we're well on track.
'One of the resounding conclu-
sions from the recent survey
was that, in fact, most offices
have indeed taken action in
investigating just how much of
a threat their corporate clients
actually are.' Although
Weiland stresses that the far
from concrete information
gathered provides only an
impression, 'in terms of credit
risk the overall number of
clients not yet sufficiently
millennium-prepared is an
approximate 10 percent. But
that is not to say the remaining
90 percent are,' he continues.
'There are three distinct
groups: the 10 percent who are
posing a risk at the moment,
around 65 percent who are
cleared as being sufficiently
prepared and a remaining 25
percent who are still hovering
in a grey area. As follow-up,
an indication of the amount of
exposure we have at risk will
soon be calculated. Also, the
identified 10 percent falling
into the high risk bracket,
expected to be made up mostly
of small and medium sized
clients, is where we will be
maximizing our efforts.' Also
as part of the follow-up,
updates must be reported by
the global credit risk depart-
ment to the Dutch Central
Bank by May. As far as bank
ing analysis goes, the jury is
still out. Conclusions follow-
ing an inventory of bank iimits
per country is in draft form
and is currently with relation-
ship managers for a reaction.
'Following this final phase of
the investigation,' concludes
Weiland, 'bank Iimits may
need to be reassessed by the
banking committee.' As
published last month, RI eco
nomie research has produced a
study breaking down specific
countries and their predicted
millennium compliance.
For further credit risk
information, or for copies of
the study, contact your local
millennium coördinator or the
millennium program helpdesk
on tel. +31 30 216 6888 or
email fm.global. millennium
infodesk.
Proving our commitment to
not only our customers but
also to beating the millennium
bug, a recently circulated
cliënt letter pledged our
dedication to Y2K compliance
and stated this commitment in
black and white - literally.
The Ietter, intended to put
clients' minds at rest, even
goes so far as to promise that
'we can continue with an
undisturbed delivery of our
services before, during and
after the turn of the century.'
According to the cliënt
statement, 'Rabobank
International initiated
thorough investigations to
determine which parts of its
business operations might be
affected by the year 2000
issue.' It has also made a
project plan and time Schedule
under which to address the
related concerns. The current
prognosis is good - all year
2000 issues will be addressed
in time. Reiterating the fact
that in reality solutions to the
millennium bug do not lie
with Rabobank alone, the
statement also realistically
sites potential out-of-our-
control bottlenecks. 'As the
current status suggests
Rabobank International will
have solved potential year
2000 problems in time.
However, no guarantee can be
given due to our dependence
on external parties such as
telecommunication companies
and power suppliers,' the
letter states. 'In order to be
optimally prepared for
potential problems, Rabobank
International is developing
contingency plans which will
allow delivery of services with
as few disturbances as
possible.' And the millennium
program (RI's global
millennium project team) is
confident we can stick to our
cliënt promise. The year 2000
compliance statement is found
in public folders/2000
millennium/info general/project
management information.
ri r* Ls\ W n 4-/~% r* mnn
April 9
September 9
December 30
December 31
Translated as 9999 in Julian calendars and many
computers use this code as 'end input'
Translated as 9999 in Gregorian calendars
and many computers use this code as'end input'
Last working day for many businesses
Lastdayin 1999
January 1 Start year 2000
January 3,4 First working day for many businesses
January 10 First working day with a 7-digit field of date
January 31 End of first month in year 2000
February 20 Leap day
March 31 End of first quarter in year 2000
October 10 First working day with 8-digit field of date
December 31 End of year 2000
