Financial firms compare notes on disaster recovery

Computerworld - Some of the nation's leading financial services companies said this week that their IT executives met earlier this year for the first time to share current disaster recovery schemes and discuss future technology recovery strategies. And what they found was that they had a lot in common -- including headaches.
"To start with, I found out I'm not alone. All banks are struggling with this," said Todd Baumann, director of enterprise business continuity at Huntington Bancshares Inc. in Columbus, Ohio.
The Technology Recovery Project involved an information exchange between Huntington Bancshares Inc., Bank of America Corp., Wachovia Corp., BankOne Corp., Comerica Inc., US Bancorp, JPMorgan Chase & Co. and RBC Financial Group.
IBM, Microsoft Corp. and Veritas Software Corp. also participated in the project, which was organized by the Financial Services Technology Consortium (FSTC) in New York and took place between November 2003 and this past June.
The banks and bank holding companies looked at mainframe, open-systems and storage-networking environments.
Firms were asked what recovery strategies they currently use, what they consider to be best practices and what cost/risk trade-offs and regulations are driving their choice of strategy. They were also asked what investments in disaster recovery they're making over the next year.
While the banks were unwilling to share specific strategies publicly for security reasons, Baumann said a common issue was the need to find a data recovery methodology that is efficient and scalable and meets the needs of internal customers.
"We'd all like to have an open checkbook to do everything right now. We'd like to do it at a price tag our companies are willing to spend," Baumann said. "It's not so much getting the money. It's putting together the right business case to say, 'Here's why we should be doing this.'"
Virginia Garcia, an analyst at TowerGroup in Needham, Mass., said the discussion is unique among financial services firms, which have traditionally been squeamish about sharing IT data, because they consider it a competitive advantage and because they don't want weaknesses exposed.

But with disaster recovery spending totaling between 1% and 2% of a financial firm's budget -- that's roughly $2 billion a year for U.S. banks -- building business continuity through best practices is becoming a necessity.
"This spending is growing well into double digits -- an increase of 17% a year," Garcia said. "There's a very concerted effort on the banking industry to get a better handle on risk management spending at the operational level."
Charles Wollmen, managing executive director for the FSTC's business