Royal Bank of Canada is splitting operations for its global trading business Monday as it responds to the coronavirus outbreak, which has intensified quickly in North America and Europe in recent days.
Canadian Imperial Bank of Commerce and Toronto-Dominion Bank said they were also considering preventative measures, while several large U.S. banks have begun to shift their trading operations off site.
RBC will divide its trading floors in Toronto, New York, New Jersey and London, spokesperson Andrew Block said in an e-mail to The Globe and Mail.
“This is a precautionary measure to ensure we are able to smoothly and seamlessly continue serving our clients,” Mr. Block said. “We recently tested these processes globally and the tests were successful."
CIBC will also move “some” of its trading floor team members in Toronto and New York this week to backup work locations as part of its business continuity plans, spokesperson Trish Tervit told The Globe.
TD confirmed it is currently evaluating its business continuity plan, and said it will likely introduce measures this week that could include separating groups of employees such as sales and trading staff.
The measures are being taken by financial institutions as the number of coronavirus cases has surpassed 100,000 globally.
All banks have backup sites at remote locations stocked with enough trading desks and computers to keep crucial operations running in the event the coronavirus spreads to major financial centres. Unlike most employee contingency plans – which can require individuals to work from home – trading divisions have complex compliance obligations and require access to specific work stations.
The Bank of Nova Scotia and the Bank of Montreal did not respond to requests about whether they would be adjusting their trading operations because of the outbreak.
Already U.S. banks are making changes, specifically those based in New York, which has seen more than 100 cases of the coronavirus. JPMorgan Chase announced in a memo to staff last week it was moving its sales and trading staff to backup locations for its London and New York offices, while Morgan Stanley and Citigroup were looking at similar strategies.
“Dividing our work force into different locations improves our ability to serve clients continuously while reducing the health risks associated with physical contact should a case arise,” JPMorgan said in its memo.
JPMorgan Chase spokesperson Brian Marchiony confirmed the plans to The Globe.
In London, HSBC Holdings PLC had to evacuate 100 staff in its Canary Wharf head office after an employee tested positive for the coronavirus, while in Spain, Banco Bilbao Vizcaya Argentaria – which has approximately 400 traders – began moving certain employees to an off-site location outside of Madrid.
In Canada, the majority of the banks have reacted to the outbreak by minimizing unnecessary business travel, restricting in-person meetings and attendance at large gatherings such as conferences and have been testing systems to make sure they could handle large numbers of employees logging in remotely.
RBC advised its staff to avoid business travel to Hong Kong, mainland China and other areas hardest hit by the virus. And other banks, such as CIBC and National Bank of Canada, now require a senior manager to approve non-essential travel.
TD Bank, which had already restricted travel to areas severely affected by the virus, tightened travel limitations last week in a memo to all staff sent by executive vice-president of human resources Kenn Lalonde and reviewed by The Globe.
It is not clear if the banks plan to implement any new measures in branches.
With reports from James Bradshaw
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