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Joint Release
Board of Governors of the Federal Reserve System
Federal Deposit Insurance Corporation
National Credit Union Administration
Office of the Comptroller of the Currency
Office of Thrift Supervision

Financial Agencies, First Data Agree on Y2K Readiness Deadlines

WASHINGTON, D.C — The federal financial regulatory agencies and First Data Corporation reached agreement today that the provider of data processing services to banks, thrift institutions and credit unions will complete Year 2000 testing of the last of six merchant processing systems that serve banking and credit union clients by June 30, 1999, and fully implement the system in a Y2K production mode by July 11, 1999.

The agreement covers a single credit card processing platform at the Nashville (Tennessee) Data Center of First Data Merchant Services, a subsidiary of the corporation. Within 15 days, First Data will submit to the agencies and its financial institution clients a written report of how it will fulfill the agreement and then update progress regularly. On this system, which is known as the Envoy processing system, First Data services more than 200 banks, thrifts and credit unions.

First Data committed to the federal agencies that it will have ample time to make the necessary adjustments to the Envoy system and to carry out appropriate testing. The agreement covers only the Envoy system, which, according to First Data, represents approximately 2 percent of its entire Y2K remediation effort. An on-site examination by an interagency team of examiners found that the Envoy system was lagging in meeting testing and implementation milestones, which are part of the interagency guidance.

A copy of the agreement between the agencies and First Data is attached.

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