Sharing Session:Business Contingency Plan (BCP)Business Contingency Plan (BCP)

Big Flood DisasterBig Flood DisasterJakarta, 2-6 February 2007Jakarta, 2-6 February 2007

5 - 6 July, 2007Kuala Lumpur, Mandarin Hotel

Indonesian Central Securities Depository (Indonesian Central Securities Depository (or KSEI - or KSEI - Indonesian termIndonesian term) was established on December 23, ) was established on December 23, 1997 in accordance with Law no. 8, 1995 concerning 1997 in accordance with Law no. 8, 1995 concerning Capital MarketCapital Market. .

On July 17, 2000, KSEI had succeeded to implement On July 17, 2000, KSEI had succeeded to implement scripless trading with their system named C-BEST scripless trading with their system named C-BEST (Central Book-entry and Settlement System).(Central Book-entry and Settlement System).

In August 2001, KSEI also succeeded to implement the In August 2001, KSEI also succeeded to implement the Disaster Recovery Centre, in accordance with Bapepam Disaster Recovery Centre, in accordance with Bapepam rule no. II.C.6. rule no. II.C.6.

KSEI systems are connected by database KSEI systems are connected by database synchronization and replication with the securities synchronization and replication with the securities central clearing house system central clearing house system ((or KPEI - Indonesian or KPEI - Indonesian termterm). ).

In August 2006, KSEI systems were connected to In August 2006, KSEI systems were connected to central bank for Government Securities Settlement central bank for Government Securities Settlement System and RTGSSystem and RTGS

IntroductionIntroduction

KSEI’s SYSTEMKSEI’s SYSTEM

Main SystemC-BEST : Central Book Entry and Settlement System

Supporting System

ORCHiD - Online Research and Centralized Historical DataE-Mon - Electronic Mutual Fund MonitoringSystem

Intranet – Daily supporting operational system, such as reporting and accounts administration.

BI-S4/RTGS – Electronic system for settlement government bonds with central bankEmiten online – Electronic system for Registrar & Issuer to know their daily securities holders’

BAPEPAM rule no. III.C.6 : Internal Controls & BAPEPAM rule no. III.C.6 : Internal Controls & Administrative Procedures of The Central Securities Administrative Procedures of The Central Securities DepositoryDepository

Point 19Point 19The Central Securities Depository must have a primary The Central Securities Depository must have a primary computer and a back-up computer that are at different computer and a back-up computer that are at different locations, that enables the back-up computer to locations, that enables the back-up computer to continue processing data within continue processing data within 2 (two) hours2 (two) hours, from , from the time of a breakdown of the primary computer. the time of a breakdown of the primary computer.

Point 20Point 20The Central Securities Depository must keep duplicates The Central Securities Depository must keep duplicates of electronic data regarding Securities Accounts in a of electronic data regarding Securities Accounts in a separate place that is secure and not closer that separate place that is secure and not closer that 30 30 (thirty) kilometers(thirty) kilometers from the principal location from the principal location..

BCP RegulationBCP Regulation

DisasterOccurred

ACTIVATEDBCP

MONITORBCP

Normal?

Risk & Impact

Analysis

Critical ?

No

Status Report to

CMT

Yes

•dependen • independen

No

YesReport to CMT for Event Status

Suspend ?

END

Monitorfor ReportingEvent Status

No

StopOperational

Yes

•manual input, • injection, •delay market, •DRC

Status Report to

CMT

•System Availability•Network•Human Resources

EMERGENCY HANDLING PROCESSEMERGENCY HANDLING PROCESS

As a main system, C-BEST is critical for As a main system, C-BEST is critical for operational, therefore having a disaster recovery operational, therefore having a disaster recovery system is a must and also a periodic testing, to system is a must and also a periodic testing, to assure its readiness to replace the main system.assure its readiness to replace the main system.

Untill now, we have already conduct 9 tests for Untill now, we have already conduct 9 tests for disaster recovery system including disaster disaster recovery system including disaster recovery center.recovery center.

Since 2007, we plan to run disaster recovery Since 2007, we plan to run disaster recovery system test for 3 (three) times a year.system test for 3 (three) times a year.

DRC Live TestDRC Live Test

TandemBI-RTGS & BI-SSSS

Modem

DATA

Webshell

RP7420 RP7420

ROUTER

BI-RTGS&SSSSServer

Modem

ROUTER

ROUTERROUTER

Payment BankLIPPO Payment Bank

MANDIRIPayment Bank

BCA

ROUTER

KPEI

ROUTER

Payment BankNIAGA

MAIN DATACENTRE

Leased Line

Ftp Archivelog

DATA

DRC DATACENTRE

WebshellROUTER

RP7420 RP7420

ParticipantNetwork

Leased Line

Network – Normal ProcedureNetwork – Normal Procedure

TandemBI-RTGS & BI-SSSS

Modem

DATA

Webshell

RP7420 RP7420

ROUTER

BI-RTGS&SSSSServer

Modem

ROUTER

ROUTERROUTER

Payment BankLIPPO Payment Bank

MANDIRIPayment Bank

BCA

ROUTER

KPEI

ROUTER

Payment BankNIAGA

MAIN DATACENTRE

Leased Line

Ftp Archivelog

DATA

DRC DATACENTRE

WebshellROUTER

RP7420 RP7420

ParticipantNetwork

Dial up analog

Dial up analog

Dial up analog

During Disaster

Leased Line

Network – Emergency ProcedureNetwork – Emergency Procedure

Securities companies are connected to Stock Exchange Securities companies are connected to Stock Exchange system via fiber optic provided by vendor for exchange system via fiber optic provided by vendor for exchange trading purposes. trading purposes.

Securities companies and custodian banks (participants) Securities companies and custodian banks (participants) are connected to KSEI via various type of network provided are connected to KSEI via various type of network provided by vendors for transaction settlement purposes. Such by vendors for transaction settlement purposes. Such networks are: dial up, leased line, microwave, and fiber networks are: dial up, leased line, microwave, and fiber optic. optic.

Participants NetworkParticipants Network

Type of Network Total %

ISDN – Telkom 52 31%

Dial up – Telkom 45 27%

Leased channel - Telkom 13 8%

Microwave – Non Telkom 30 18%

Fiber optic – Non Telkom 26 16%

TOTAL 166 100%

Disaster Events DetailDisaster Events Detail

Friday, Feb 2, 2007Friday, Feb 2, 2007

Participants began to contact KSEI’s staf via mobile Participants began to contact KSEI’s staf via mobile phone, informing that they could not connect to KSEI’s phone, informing that they could not connect to KSEI’s system (C-BEST).system (C-BEST).

There were 11 participants, who came to KSEI’s office, There were 11 participants, who came to KSEI’s office, asking KSEI’s staf to help them, settled their transaction, asking KSEI’s staf to help them, settled their transaction, because of the unavalability of the network.because of the unavalability of the network.

There were unsettled instruction for that day, especially There were unsettled instruction for that day, especially OTC VP.OTC VP.

KSEI’s system could not provide reference price for KSEI’s system could not provide reference price for Corporate Bonds, because of participation limitation from Corporate Bonds, because of participation limitation from fund managers.fund managers.

Telecommunication network (data and voice), Telecommunication network (data and voice), particularly fixed line be unavailable.particularly fixed line be unavailable.

Connection to Central bank, unavailable since 11:45 amConnection to Central bank, unavailable since 11:45 am

Con’t….Con’t….

Monday, Feb 5, 2007Monday, Feb 5, 2007

More participants came to KSEI’s office, More participants came to KSEI’s office, because of the unavalability of the because of the unavalability of the network – 69 participants.network – 69 participants.

KSEI’s system still could not provide KSEI’s system still could not provide reference price for Corporate Bonds, reference price for Corporate Bonds, because of participation limitation from because of participation limitation from fund managers.fund managers.

Connection to Central bank had already Connection to Central bank had already back to normal.back to normal.

Con’t….Con’t….

Tuesday, Feb 6, 2007Tuesday, Feb 6, 2007

Participants came to KSEI’s office had already Participants came to KSEI’s office had already decreased – 58 participants.decreased – 58 participants.

KSEI’s system already provided reference price KSEI’s system already provided reference price for Corporate Bonds, because of limitation of for Corporate Bonds, because of limitation of participation from fund managers.participation from fund managers.

Wednesday, Feb 7, 2007Wednesday, Feb 7, 2007

BusinessBusiness back to normal…. although back to normal…. although telecommunication network, particularly incoming telecommunication network, particularly incoming call for fixed line still be unavailable at KSEI’s call for fixed line still be unavailable at KSEI’s office.office.

Flood immersed almost 70% area of Flood immersed almost 70% area of Jakarta, which cause transportation Jakarta, which cause transportation problem, especially for participants who problem, especially for participants who should come to KSEI’s office.should come to KSEI’s office.

Network telecommunication especially Network telecommunication especially provided by Telkom (data and voice) were provided by Telkom (data and voice) were went down almost 70% on central went down almost 70% on central business area on Friday (Feb 2, 2007).business area on Friday (Feb 2, 2007).

Participants could not contact KSEI’s Participants could not contact KSEI’s office via telephone network (voice fixed office via telephone network (voice fixed line).line).

DISASTER’S IMPACTDISASTER’S IMPACT

CUSTOMER PROBLEMSCUSTOMER PROBLEMS

Participant using leased channel or dial-up, which are Participant using leased channel or dial-up, which are provided by Telkom (one of the largest provided by Telkom (one of the largest telecommunication provider in Indonesia) were having telecommunication provider in Indonesia) were having problem on their connection to KSEI. Such participants problem on their connection to KSEI. Such participants were:were:

Securities company – 66 of 144Securities company – 66 of 144

Custodian Banks – 5 of 18Custodian Banks – 5 of 18There were also other parties that were having There were also other parties that were having problem on their connection to KSEI. Such parties problem on their connection to KSEI. Such parties were:were:

Fund Managers – Fund Managers – all of them (54)all of them (54)

Registrars – 2 of 14Registrars – 2 of 14

Payment Banks – 1 of 4Payment Banks – 1 of 4

Central Bank, and Central Bank, and

Real time data providerReal time data provider

Setup additional computers and room to help Setup additional computers and room to help participant who came to KSEI’s office to do their participant who came to KSEI’s office to do their transaction settlement, on Feb 5, 2007 and Feb 6, transaction settlement, on Feb 5, 2007 and Feb 6, 2007 for 69 and 58 participants respectively.2007 for 69 and 58 participants respectively.

Additional computers came from KSEI’s staff and Additional computers came from KSEI’s staff and rental company.rental company.

Immediate rental for additional PC (on non Immediate rental for additional PC (on non business day, Saturday/Sunday, Feb 3-4, 2007). business day, Saturday/Sunday, Feb 3-4, 2007).

Asking for PoA (power of attorney) for some Asking for PoA (power of attorney) for some participants who were helped by KSEI’s staf, participants who were helped by KSEI’s staf, executing their settlement instructions.executing their settlement instructions.

Open and close markets beyond normal business Open and close markets beyond normal business hour to settle participant instructionshour to settle participant instructions

Providing additional official wireless Providing additional official wireless communication with mobile phones (CDMA & GSM) communication with mobile phones (CDMA & GSM) = 9 numbers= 9 numbers

Almost all operational staffs act as help Almost all operational staffs act as help desk/customer supportdesk/customer support

Contingency Plan in ActionContingency Plan in Action

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Flood areaFlood area

Description :Description :

Flood Map Area