BCBS and IOSCO – Implementation monitoring of the PFMI: Level 3 assessment of financial market infrastructures’ business continuity planning

July 21, 2021 – BCBS report on financial market infrastructures (FMIs) business continuity planning. Prepared and issued by Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO). Assessed implementation of Principle 17 (Operational risk) of Principles for financial market Infrastructure (PFMI) in 38 FMIs of 29 jurisdictions, part of regular monitoring. PFMI set international standards for payment, clearing, and settlement systems.

Overview
All surveyed FMIs have operational reliability objectives, focusing on system availability and recovery time, reportedly review continuity plans at least annually, test regularly. Business continuity plans assessed included pandemic scenarios prior to Covid-19; however, the report also found some FMIs do not fully meet expectations regarding recovery from operational incidents such as natural disasters or IT systems outages. Business continuity management of potentially many FMIs does not seem to aim to resume operations timely including in event of wide-scale or major disruption. This is a serious area of concern and CPMI and IOSCO expect the relevant FMIs and their supervisors to address this as a matter of the highest priority.

Covid Situation
Even if plans were made pre-pandemic FMIs say theirs also cover pandemic scenarios. Includes a high-level summary of FMIs’ actual responses to Covid in some jurisdictions. Outlines that overall FMIs have not experienced service disruptions during pandemics.

For more information, visit www.bis.org.

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