Weary of disasters both natural and man-made, the Long-Term Credit Bank of Japan Ltd. has consolidated its U.S. and Cayman Islands data processing operations into a single site.
The center, located across the Hudson River from Manhattan in Jersey City, went live last week.
Hiroyuki Yasutake, deputy general manager of the bank's New York branch, said the company's London office was once damaged in an Irish Republican Army bombing.
He added that the bombing, along with other disasters that didn't affect the bank, such as the bombing of the World Trade Center, the flooding in Chicago, and the riots in Los Angeles, made officials realize that they needed to centralize the bank's North American data processing.
The site, in the Newport Financial Center, will handle all the data processing for LTCB's branches in the United States and Caymen Islands, as well as act as a hot site for disaster recovery operations.
"In the event any of our offices are damaged by fires or other emergency situations, we will be able to operate our banking transactions as usual at the new center," said Takashi Uehara, director and general manager of the bank's New York branch.
By establishing its own computer center, he said the bank is strengthening its data processing and backup capabilities.
Safe Haven for Computers
The site is equipped with its own power supply and telephone system and enough work space to accommodate 100 bank employees. The bank has also installed extra security systems and a series of local area networks to ensure successful operation.
"We want to be able to access our operation at all times, and we think this is the best way to ensure we are always up and running," said Mr. Yasutake. "The computers will be safe and business will be able to continue as usual, regardless of the type of disaster."
The bank uses International Business Machines Corp.'s AS/400 mainframes for processing. Previously, each of its branches processed information in-house and transmitted the data to the bank's headquarters in New York.
Mr. Yasutake said LTCB chose Jersey City because of its proximity to New York and the reliability of the buildings in the Newport complex.
"We wanted a location close by to our offices here in New York," he said. "New Jersey is very convenient and was able to be built to meet our specifications. The buildings are very stable."
Long-Term Credit Bank of Japan was founded in Toyko in 1952. By the end of 1992, with assets of $274 billion, it ranked as the fourteenth largest bank in the world. The bank employs 450 people in its U.S. offices in Los Angeles, Chicago, Atlanta, New York, and Dallas, as well as on the Cayman Islands.
Ricardo Kleinbaum, a senior vice president at Fitch Investor Services Inc. in New York, said the bank remains an important participant in the tightly knit Japanese system, although it has some financial trouble spots.
"We recently lowered the rating of its structured debt because of concerns with underlying earnings and the weaknesses of its subsidiaries," he said. "It is still a substantial player, but its assets quality remains under substantial pressure as it comes out of the recession in Japan."