The greatest loss to the financial services industry is the loss of senior management, according to disaster recovery experts. As one consultant said: "You can do so much in the recovery of data, but New York will lose out as a financial centre because the deals and expertise have been lost with the staff."
As the dust settles on the human tragedy in New York, it is extremely likely that all information of deals that took place on the day before the attack on the World Trade Center will have been lost for ever. While all banks would have carried out a back-up over the weekend, the tapes of the back-ups carried out the night before the disaster would not have been collected or removed from the building until later that morning.
However, the Depositary Trust and Clearing Corporation has confirmed that all equity trades carried out the day before the attack settled successfully.
Within days of the disaster, White House officials were urging Wall Street to resume trading, but many of the banks said they needed more time. Disaster recovery experts said it would take at least a week for banks to recover the trading data recorded during the weeks up to suspension of business.
The New York Stock Exchange deemed it impractical to put disaster recovery plans into action before this week. However, trading on Nasdaq continued without a glitch for an hour and a half after the disaster, before it voluntarily shut down.
European trading was also hit with Finex Europe in Dublin, the currency exchange subsidiary of the New York Board of Trade, which was based in one of the buildings in the surrounding World Financial Center, remaining closed. Officials in Dublin said the European market could not, and would not, open until New York opened.
Paul Barry-Walsh, founder of disaster recovery firm SafetyNet in London, which was sold to Guardian IT last year, thinks New York businesses were less prepared for disaster than London. He says: "As a financial centre London is more keenly aware of the threat of terrorism and has more recovery sites and faster data recovery contingency plans. People will be surprised at how unsophisticated disaster recovery plans are among New York businesses."
He says how fast businesses can get back on track is important. When Bishopsgate was bombed in 1993, in the heart of the City of London, most banks were up and running within days, but a handful of smaller businesses never recovered. Continuity planning has been firmly on the agenda of banks and financial institutions in London for more than 10 years.
Another important issue, according to Barry-Walsh, is the importance now given to e-mail in business deals, which he now says is a mission critical application. "But many banks have not realised this and e-mail is extremely unsupported as an application. People are falsely reassured that e-mail is backed up off-site.
"This is not the case, and the failure of banks to access previous e-mail communications is going to compound the road to recovery."
Reuters, which supplies the market data to many bank dealing rooms, operated a data distribution facility in the World Trade Center which supported 3,000 users.
A Reuters spokesman says it had been working with its customers in redirecting data to contingency sites and to other offices. The spokesman says: "The internet has also been very useful in getting banks up and running quickly, with some choosing to work from home."
Reuters has made a cross-market package of real-time news and financial information available on its website to customers free of charge.
Several of the banks based in the World Trade Center have disaster recovery sites in New Jersey. Jersey City is on a separate power grid from Manhattan. However, it is understood that the World Trade Centre had the world's densest fibre-optic network, carrying the world's financial information in and out of the building. …