The Banking Committee, and this subcommittee, have worked to focus the attention of the financial industry and its federal regulators on the need for immediate action. And while business and government should be working right now to prevent a computer catastrophe in January of 2000, the reality is that computer problems will occur, and some of them will be very complicated and very expensive to fix. Mr. Chairman, I am glad to see that, through this subcommittee, you are diligently pursuing all aspects of the Year 2000 problem. Although the focus of this hearing goes beyond banks alone, I must say that I am concerned about the poor progress that many banks have made on the Year 2000 problem. The bank regulators now say that, despite efforts to focus industry attention on this ticking time bomb, many banks still have not taken even the most basic steps to prepare for Year 2000.
Most larger banks are hard at work.
But smaller banks, especially community banks, are in poor shape. Fifteen percent of these banks have done virtually nothing to address the Year 2000. Another twenty percent are only just waking up to the problem. Mr. Chairman, this is a disaster in the making. Unfortunately, although banking institutions are not where they should be, they are at least ahead of the rest of industry.