Washington, D.C.--U.S. Sixth District Congressman Frank Lucas participated in the U.S. House Committee on Banking and Financial Services hearings regarding the Year 2000 (Y2K) computer problem today. This time the concerns were focused on the challenge facing international banking and financial institutions and their consumers.

"The Y2K problem is not just a national issue," Lucas said. "Even if the United States succeeds in completing its own domestic Y2K tests with flying colors, American banks and businesses still face significant risks from potentially non-compliant foreign counterparts like foreign banks, international payment and settlement systems, trading partners, creditors and international communications networks."

To date, information on international readiness is sketchy. A recent report from the Board of Governors of the Federal Reserve stated that there is concern that most foreign markets and financial institutions are lagging U.S. organizations by anywhere from 3 to 18 months.

"There is a lot of worry out there that specific regional problems are affecting key player countries in properly addressing the Y2K problem," Lucas said. "For example, the Asian financial crisis, the implementation of the new European currency--the euro--in the European Community, and the world-wide demand for technology personnel may all serve as distractions from the Y2K problem.

"I did find it encouraging to learn, however, that a number of international initiatives have been taken, as this is a problem of international significance," Lucas said. "In foreign exchange trading alone, a daily average of $1.2 trillion in

foreign exchange transactions occur globally, and over 80 percent of them involve the U.S. dollar. An interruption of this vast activity in the year 2000 could have a significant impact in the United States and around the world."

In April, government and private representatives of 52 nations attended a special Year 2000 round table. The Joint Year 2000 Council, comprised of members of the international financial regulatory community, developed out of this meeting. The international Committee on Payment and Settlement Systems has also established an international reporting framework for operators of payment systems to disclose their Year 2000 preparations and testing.

Also, a private sector Global 2000 Coordinating Group has been created with a specific focus on those countries, cities and firms which the Group has identified as having financial markets which must be ready for the year 2000 because of the impact they could have on global markets.

"So while the Republican Congressional Leadership has pledged to commit every dollar necessary to solve the year 2000 computer problem in the U.S.," Lucas said, "it is my hope that these international entities, in addition to the watchful eye of the U.S. Congress, will be capable of accomplishing what is necessary to make New Year's Eve 2000 an enjoyable occasion."