Paris-based Etrali, a provider of telecommunications services to trading desks, is offering Network Continuity Services (NCS) to help bansk protect themselves against costly and damaging downtime caused by business interruptions.
“Under the Basel II Capital Accord the amount of regulatory capital required by banks to cover their customer and operational risk exposures will be determined on a rating system,” says Etrali in a statement. “Those institutions that cannot demonstrate adequate risk mitigation through business continuity planning face the possibility of having their rating downgraded, forcing them to hold a higher percentage of regulatory capital and limiting their investment opportunities.”
Etrali is already supplying a number of its major bank customers, including BNP Paribas, Goldman Sachs, Socit Gnrale and CDC Ixis with NCS tailored to their requirements.
“Interrupted business invariably means lost business,” says Lila Benhammou, Etrali’s connectivity product manager. “In fact, the cost of downtime has been estimated by financial analysts at between Euros 6m and Euros 25m per hour with additional uninsurable capital losses associated with customer dissatisfaction and possible desertion. And with the advent of a new regulatory environment, business continuity planning is becoming ever more vital.”
Etrali aims to supply the technology and expertise that helps banks mitigate the risk of business interruptions, ranging from catastrophic natural disasters or acts of terrorism, to power outages, technical glitches and human errors.
With Basel II due to come into effect at the end of 2006, banks will have even more reason to demonstrate their ability to assess and manage operational risk.
“Banks have the opportunity to enhance their risk rating and lower their capital requirement under Basel II if they can demonstrate that they have lowered their risk exposure. The banks that can free-up capital to reinvest elsewhere in their business will be the winners,” Benhammou says.
Etrali offers local Voice Continuity protection against local loop fail over by providing an alternative loop to which all voice traffic can be switched; In-City Voice Continuity that provides the re-routing of all private circuits from a customer site to the disaster recovery site in the same city, protecting clienst against loss of trading floor infrastructure due to fire or flood, for example; Etr@net Distributed Voice Continuity for disaster recovery of private circuits by re-routing them from a damaged site to a list of recovery sites in multiple locations, with traffic distributed according to a pre-defined strategy; and Dedicated Trading Network Continuity that protects against multiple threats to data, systems and networks by connecting numerous sites in financial centres around the world.