Independent Banker - December 2017 - 64

Risks & Rules
to cause physical damage, but most
of them will, at the very least, cause
power outages of various lengths.
Such events seem to have increased
in frequency and intensity over the
past 20 years, making it more important
than ever that community banks
be prepared to respond.
During a natural disaster, community
banks must protect the safety of
their own employees, customers and
physical structures. They must also
protect their financial data and transactions,
the majority of which are
now electronic, and continue to meet
the financial needs of their customers
as much as possible. If branches are
damaged and the power is out, things
get difficult.
According to Scott Teel, senior
director, corporate communications,
for Agility
Recovery, based
in Denver, Colo.,
disaster preparation
should be
done when the
disaster is still
theoretical-not
an imminent
reality. " You
need to be
and phones, and computer systems
including servers, routers, laptops
and desktops.
According to Jeremy Dalpiaz,
ICBA assistant vice president for
cyber and data security policy, it is
important that community banks not
only have comprehensive disaster
preparedness and incident response
plans in place but also test those
plans on occasion to address any gaps
in coverage.
thinking about
all of the considerations
well
ahead of time, "
he says. " For
example, you
need to know
that you will
have access to
generators for
sure if an event strikes. You can't wait
and hope to find some while everyone
else is looking for them, too. "
Agility Recovery provides business
continuity and disaster recovery
services to financial institutions,
primarily. Services include temporary
generator power, mobile and
existing office space that allow for
the continuation of retail branch and
back-office functions, satellite communications
equipment for internet
" You need to be
thinking about all of
the considerations
well ahead of time. For
example, you need to
know that you will have
access to generators for
sure if an event strikes.
You can't wait and
hope to find some while
everyone else is looking
for them, too. "
AGILITY RECOVERY
Cyber and data security
As part of any disaster recovery plan,
community banks must consider
how their data backups are stored.
The Federal Financial Institutions
Examination Council (FFIEC) IT
Handbook on Business Continuity
Planning includes guidelines on
this issue. " The
IT Handbook
states that banks
should store
their backup
data in a secure
off-site location
to allow
restoration and
normal processing
in the event
of a disaster, "
Dalpiaz says.
In case of
a total loss of
data, including
backup data,
community
banks should
consider joining
Sheltered
-SCOTT TEEL,
Harbor, which establishes industry
standards for data backup in a secure
vault. If all disaster recovery and
business continuity options fail at
a bank, a restoring partner, such as
another bank or vendor, can service
customers by providing account balance
and basic account functions in a
relatively short time period.
Should a branch sustain so much
damage that it must close for repairs,
community banks should also have a
60 ICBA Independent Banker December 2017
plan in place that offers continuous
customer account processing, such
as small-business processing payroll,
customer check clearing and bill
pay. " Electronic access to accounts
is an excellent way to service customers
during a natural disaster, " says
Dalpiaz. " If banks use a vendor, make
the vendor aware of the situation
and work with them to ensure that
customers have the access they need
to perform their banking functions
during a disaster. "
Tailor-made plans
The nature, scope and complexity
of a community bank's natural
disaster plan will largely depend on
its size. Black Mountain Savings Bank
in Black Mountain, N.C., is small
enough that it looks to third parties
to help fill some of its gaps.
" We work with Secure Banking
Solutions out of South Dakota and
our IT service provider, All Covered, "
says Meredith Olivia Begley, corporate
secretary-treasurer for the
$38 million-asset community bank.
" SBS provides us with tabletop testing
once a year to make sure our
business continuity plan and incident
response plan are up to date and
working properly. "
The community bank, SBS and the
bank's IT service provider recently
conducted a mock incident response
test, where the incident was a flood,
and walked through all of the steps
the bank and IT provider would need
to take during a real flood.
" We realized that since our server
is in the basement, even though we
are not in a floodplain, this could
still potentially be a problem for us, "
Begley says. " As a result, we are now
going to look into how to address that
potential exposure. "
Black Mountain Savings Bank
is also planning for crises beyond
natural disasters. As part of its test, it
looked at how to manage a potential
flu outbreak among bank employees.
" We only have six employees, so this
is something we need to consider, "
Independent Banker - December 2017

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