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Wall Street giant struck by India’s brutal Covid wave

Bangalore: Located on Outer Ring Road in Bangalore, about 8,300 miles east of Wall Street, it was once the center of the back office of the global financial industry.
Prior to the pandemic, this cluster of glass and iron towers had thousands of companies such as Goldman Sachs Group Inc. and UBS Group AG who played a key role in everything from risk management to customer service and compliance. The employee lived there.
Now the building is eerily empty. And with the surge in cases in Bangalore and most of India, the telecommuting arrangements that have maintained Wall Street back office operations for months are under intense tension. An increasing number of employees are getting sick or fighting for important medicines such as oxygen for their relatives and friends.
Standard Chartered Bank said last week that about 800 of India’s 20,000 staff were infected. Twenty-five percent of UBS’s team employees are absent, said a company executive who spoke on condition of anonymity for fear of losing his job. At Wells Fargo and Company offices in Bangalore and Hyderabad, partner card development, balance transfers and loyalty programs are behind schedule, executives said.
Banks have traditionally avoided major turmoil by moving tasks to other offshore hubs, but India’s Covid crisis is an indisputable vulnerability for companies that have outsourced functionality to the country for decades. Exposed sex. India’s outbreaks are intensifying, despite vaccinations boosting economic recovery in other parts of the world, raising the risk of back office bottlenecks when Wall Street businesses are rarely busy. I will.
“This isn’t just a local Indian issue, it’s a global crisis,” said DDMishra, a senior director and analyst at researcher Gartner Inc. To plan and take action to mitigate as needed, “Mishra and his colleagues wrote in a memo last week.
Nasscom, India’s $ 194 billion outsourcing industry and its leading lobby group of about 5 million employees, downplays threats to operations. However, fellow analysts at Mishra and Gartner say they are flooded with calls from uneasy global clients asking about the situation at Covid-19 every day.
The total number of coronavirus infections in India has exceeded 21 million, of which about 7 million have been added since mid-April. Karnataka, whose capital is Bangalore, reported more than 50,000 new infections for the first time in the last 24 hours, almost half of which occurred in the city.
Experts warn that the crisis could worsen in the coming weeks, with one model predicting 1,018,879 deaths by the end of July, four times the current official number of 230,168. It has become. A model created by a government adviser suggests that the waves could peak in the next few days, but the group’s forecasts have changed and were wrong last month.
In Bangalore, Delhi and Mumbai, the three main hubs of the financial giant’s business, infection rates have reached very surprising levels and local governments have ordered strict restrictions on mobility.
While the crisis has hit the country’s $ 2.9 trillion economy, recent waves have particularly affected the 20s segment of the population that dominates and is difficult to replace outsourcing companies. Most of them are English-speaking, technically skilled workers.
Continuity plan
For now, the back office department is either marshaling part-time workers or asking employees to perform multiple roles and relocating staff to make up for the absentee. They plan overtime, postpone low-priority projects, and conduct pandemic continuity planning exercises in multiple locations in the event of an intensifying virus wave.
Wells Fargo employees said some work had been transferred to the Philippines. In the Philippines, staff work night shifts to regain slack. A San Francisco-based bank employs approximately 35,000 workers in India to assist customers in need of car, housing and personal loan processing, collection, bank account opening, renewal and closure. .. The company did not respond to requests for comment.
UBS employees said many of the 8,000 staff at banks in Mumbai, Pune and Hyderabad were absent and jobs were being sent to centers such as Poland. Workers at the Swiss Bank of India are responsible for trade settlement, transaction reporting, investment banking support and asset management. Many tasks require turnarounds for the same day or the next day. The UBS representative did not respond to the request for comment.
An executive who asked not to reveal his identity because it was unclear when the Indian government would contain the crisis blindly skipped the situation without knowing how many employees would be affected from one week to the next. I compared it to being there.
Load rebalancing
Standard Chartered CEO Bill Winters said in a statement last week that he was “carefully considering ways to rebalance the load,” with some work in Kuala Lumpur, Tianjin, He said it was being sent to Warsaw. “In any case, I think we are very well prepared.”
Jes Staley, CEO of Barclays Plc, said some features have been moved from India to the United Kingdom. Call volume has increased and people are suffering, he said, adding that the signs of pressure are noteworthy. The bank has 20,000 employees in India.
When they saw these banks scrambled to continue their operations last year due to a sudden blockade ordered by Prime Minister Narendra Modi, the European Banking Authority promoted outsourcing of support functions. “We have exposed these banks to operational risk,” he said.
After asking employees to work from home all at once last year, most employees continue to work at almost 100% telecommuting level. Employees of Natwest Group Plc in Bangalore, Delhi and the southern city of Chennai make up one-fifth of the world and are fully prepared to work from home.
Management bandwidth
Similarly, thousands of Goldman employees work from home, performing high-end business tasks such as risk modeling, accounting compliance, and app building. Bank representatives said the workflow could be absorbed by a wider team if needed and had no significant impact so far.
Citigroup said there is currently no significant disruption, but Deutsche Bank AG said employees are working seamlessly from home. Morgan Stanley and JPMorgan Chase & Co elaborated on their relief efforts, but did not elaborate on their impact. Last week, HSBC Holdings CEO Noel Quinn said he was “watching it carefully” and ruled out significant implications at this stage.
Not only are we worried about business interruptions, but we also ensure employee well-being and medical assistance, and all large outsourcing units use a lot of management bandwidth.
For example, at a recent full-scale virtual business strategy team meeting in Accenture, it wasn’t about regular salary increases or promotions. Instead, workers demanded flexibility, reduced workloads, and not held meetings on Friday, executives said.
According to one executive, their size is an obstacle, but it’s not clear where to go elsewhere in search of talent and size, he added.
“We are telling our clients that we need to ease service levels and reduce expectations in the coming weeks,” said Gartner analyst Mishra. “This is not a normal situation.”

Wall Street giant struck by India’s brutal Covid wave

Source link Wall Street giant struck by India’s brutal Covid wave

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