The year 2011 will be long remembered due to the variety of weather challenges that hit communities in Oklahoma. In February, a devastating blizzard plowed through the town of Broken Arrow, followed by a power outage in April. AVB’s (Off-site Link) FedACH® Services were impacted by these disruptions, and staff was faced with the challenge of trying to continue to both originate and receive automated clearing house (ACH) files.
Through all of these trials, AVB was able to continue to transact critical payments with the help of a well-developed and practiced business continuity plan, which included having a FedACH buddy bank relationship set up with Jack Henry Banking.
A buddy bank relationship can allow your organization to connect to the Federal Reserve Banks using another institution’s equipment to process your FedACH transactions in the event of an outage scenario or disaster situation at your institution’s location.
Owned and operated by the same family since its inception in 1905, AVB has four Oklahoma branch locations, including three in Broken Arrow and one in Tulsa. It currently employs approximately 90 people. Becky Collins, senior vice president, has been with the bank for 23 years and is responsible for FedACH and Fedwire® transactions.
Collins stated that thorough testing of AVB’s business continuity plan was what helped staff stay afloat during last year’s contingency events. “We review our bankwide contingency plan annually and go over it with the various departments. We get department heads together, choose a disaster scenario and walk through what to do in the event of this scenario. Then, we determine who needs to be called and what steps we need to take.”
The blizzard in February 2011 prevented most of AVB’s staff from getting into the bank. Collins recalls, “Although we were able to use existing staff to process during the blizzard, it became apparent that we needed an alternative.” AVB’s staff contacted the Federal Reserve’s FedACH Central Operations Support Site, and representatives walked them through what needed to be done. It was not long before AVB’s buddy bank agreement was in place.
Later that year, when faced with a power outage and then a disruption to their FedLine Advantage® access solution connection, AVB was well-prepared to react to these situations and to continue its processing. According to Collins, this preparation and practice caused everything to go “seamlessly.”
Collins offered this advice to other organizations who could easily find themselves in similar situations: Be prepared. “Make sure your plan is up-to-date and you have tested it. You don’t want to be in a situation like this and not have tested your plan. We’re just happy it went as smoothly as it did. Setting up the FedACH Services buddy bank relationship was very easy.”
For information on how to set up this type of relationship, please contact FedACH Central Operations Support at (866) 234-5681.
As evidenced through AVB's experience in 2011, it is critical to have an up-to-date and extensive contingency plan in place at your organization, with periodic reviews and testing of the plan. For more information about Federal Reserve Financial Services' business continuity planning, please review the online National Business Continuity Guide. This guide provides continuity information for all Federal Reserve products and services in the event of a service disruption.
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