Regulators are issuing year-2000 guidance so late that it may be irrelevant, an official from the General Accounting Office testified Wednesday.
Jack L. Brock Jr., the GAO's director of government and defense information systems, cited guidance on customer risk and vendor management issued Monday by the Federal Financial Institutions Examination Council as an example.
"These are things that should have been out over a year ago, and as a result we question their utility," he told the Senate Banking Committee's financial services and technology subcommittee. Regulators, he said, "have not acted quickly enough."
The exam council also came under attack from Sen. Robert F. Bennett, who chaired the hearing. "It's my impression that FFIEC is a bottleneck here," the Utah Republican said.
But Office of Thrift Supervision director Ellen S. Seidman defended the group.
"Any interagency action at any interagency group always takes longer," she said. "But we believe that we benefit from both the coordination and the quality of the product."
The exam council criticism surfaced at a hearing on year-2000 work by the Office of Thrift Supervision. Mr. Brock gave the OTS mostly high marks, including an A for inoculating its own computers.
"It's much more enjoyable sitting up here with an agency witness whom we're saying mainly good things about," he said in a veiled reference to two prior hearings in which the watchdog group critiqued the National Credit Union Administration and the Federal Deposit Insurance Corp.
Ms. Seidman said the OTS has examined and rated 200 of the 1,200 thrifts the agency regulates. Of the 200, 77% achieved a satisfactory rating, 22% needed improvement, and 1%-just two thrifts-were unsatisfactory. All 1,200 examinations will be completed by June 30, she said.
Mr. Brock did express concern that the OTS' 24 information systems experts would be spread too thin as the new millennium nears. He also said the agency should be further along on its contingency plan.
The GAO is issuing separate reports on each of the five banking regulators' year-2000 campaigns. The final two reports will cover the Office of the Comptroller of the Currency and the Federal Reserve Board.
