Global banks including UBS Group and Bank of America are expanding their contingency plans across Asia to ensure their operations are running as the spread of the coronavirus accelerates outside China.
Amid continued fears of the spread of the coronavirus epidemic, banks in Asia are having to review the preventive and emergency measures they have in place.
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Credit Suisse Group is among lenders starting to implement alternative work arrangements in South Korea, adding Asia’s fourth-largest economy to the list of areas where staffers are being moved into different offices.
The hope is that operations can continue should an infection prompt the closure of one location. Banks are considering similar moves in Japan.
Firms from Shanghai to Hong Kong and now Seoul are rethinking how they work and travel to keep staffs safe and ensure that business continues. Deals involving Chinese companies have slumped, as have initial public offerings in Hong Kong.
HSBC Holdings and Singapore’s three biggest banks have warned that the virus may force them to set aside more money for soured loans.
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By GlobalDataA rapidly spreading virus
In South Korea, infections have topped 1,200, making it a new hot spot for the virus, that has killed more than 2,700 people globally.
Infections in South Korea jumped from 51 a week ago, with a U.S. soldier stationed in the country becoming the first reported American military case. About two dozen countries including Singapore have levied restrictions on travellers from South Korea, while flights and tour-group trips to the nation are being cancelled.
In Japan, Prime Minister Shinzo Abe called for major sporting and cultural events to be called off, postponed or scaled down over the next two weeks, saying the move was crucial in preventing the domestic spread of the virus. Japan has 164 confirmed cases.
The rapid spread of the virus has prompted the Bank of Japan to ask major banks about their preparedness for a worsening of the outbreak. Initial findings from the talks indicate that large financial institutions are well placed to deal with the situation, the people said, asking not to be identified.
Differing threat levels
UBS has put South Korea on a so-called level 2 as part of it business continuity planning, in line with Hong Kong and Singapore. China is categorized at level 3, signalling the highest risk.
South Korea is rated as an “increased caution” at HSBC, meaning that business travel can continue but that employees should reconsider the need for the trip and avoid the heaviest hit areas of Daegu and Gyeongbuk, a spokeswoman said.
Morgan Stanley and Standard Chartered have also restricted travel to and from South Korea.
Morgan Stanley employees traveling from South Korea, or in close contact with someone who has been there, need to work from home for 14 days afterward, a person said.
Banks are also starting to take measures in northern Italy, where more than 250 people have been infected. Many large companies, including Unicredit and Fiat Chrysler, have asked employees to work from home and cut back on business travel.
