with others, the issue of telecommunications circuit diversity is very important. i encourage firms to take this issue seriously and to discuss it with individual telecommunications providers, industry groups, and appropriate government officials. conclusion in taking the next steps to strengthen the foundations of our critical financial markets, we need to constantly remember how dependent we are on one another. we will not accomplish our task if one or two organizations strengthen their resilience and others do not. instead, we need to work hard to adopt consistent strategies to meet regional risks that together address prevention, management, and testing. the importance of creating and maintaining a highly resilient financial services sector is self - evident. similarly, the challenges to achieving that goal are numerous, involving, as i indicated, people, business, and technology. given the importance and complexity of this topic, senior management will need to become fully engaged. at the international level, the openness of our financial systems means that the business - continuity practices in one country can affect critical markets in another. we will therefore need to share information and sound practices that will help us address regional risks in various countries. at this stage, this does not necessarily mean traditional regulatory coordination. rather, private firms and the financial authorities will need to work together within their various communities and with each other to make our key business - continuity practices more robust and more consistent. we also need to recognize that new business - continuity strategies need to be practical. we are looking forward to receiving the views of market participants and other knowledgeable experts to help ensure that the final white paper ultimately sets out sound practices that are well grounded and practical. as we work through these new challenges, however, we must keep in mind that to do nothing would leave serious risks unaddressed. i would like to close by noting the importance of our financial centers. these cities are a source of work, play, and inspiration for millions of people. these cities need to be vibrant and resilient, even as new challenges arise for security and stability. our financial policies to address new regional challenges should be designed to strengthen the resilience of these great centers and their people, not to abandon them. the regional diversification of back offices and operational sites is intended as a prudent strategy that will enable financial centers and their markets to continue to serve as robust sources of economic progress.

roger w ferguson, jr : business continuity after september 11 remarks by mr roger w ferguson, jr, vice - chairman of the board of governors of the us federal reserve system, at the swift sibos world forum, geneva, 3 october 2002. * * * good afternoon ladies and gentlemen. i would like to thank the swift organization for inviting me to speak to you about disaster recovery and business continuity, one of the main topics you have been discussing this week. it has now been a little more than one year since the events of september 11. since then, bankers and the regulatory authorities in various financial centers have been intensively discussing new business - continuity challenges. this forum is very important for two reasons. first, swift itself is a critical service provider for the largest financial institutions and markets. swift ’ s efforts to provide leadership in strengthening business continuity are both welcome and important. second, the annual sibos meetings bring together financial industry leaders from around the world to discuss common issues affecting funds transfer, securities clearing, and other payment and settlement businesses. the people at this conference have both the responsibility and the experience to address serious common issues involving disaster recovery and business continuity. this afternoon i would like to share some thoughts with you about business - continuity challenges and to discuss a white paper on this topic that regulators in the united states have recently published for public consultation. i would also like to underscore the opportunities and responsibilities that financial firms and their financial utilities have in this new environment. lessons from september 11 about business continuity in financial markets one of the essential lessons of september 11 is that the human spirit is both noble and resilient in the face of tragedy. many acts of heroism have been recorded. i am sure that many more have not been recorded. unparalleled cooperation in the financial markets supported both assistance to those in need and resumption of day - to - day operations. in the end, although the financial markets quickly returned to normal operations, i hope that we have learned from our experiences and are able, in a continuing spirit of cooperation, to address the vulnerabilities of the financial industry that were revealed by those events. it is critical that we vigorously address the possibility of terrorist attacks in areas where major financial markets or operational centers are concentrated. in discussions with financial institutions, someone typically asks, what are the specific threats or scenarios that we need to guard against? the answer to this question is not easy because law - enforcement officials and knowledgeable experts discuss a wide range