Communiqué of the Banco de Portugal on compliance with the year 2000

19 July 1999

After the conclusion of the second testing round performed in May and June, the Year 2000 tests, within the scope of the Payments Systems, were successfully completed.

This second testing round covered both the Portuguese Real Time Gross Settlement System (RTGS) – Sistema de Pagamentos de Grandes Transacções (SPGT) - and the Automated Clearing Subsystems (cheques, interbank collection of bills and interbank electronic transfers). In parallel with SPGT testing, tests covered also the TARGET (Trans-European Automated Real-time Gross settlement Express Transfer, i.e., the RTGS for the euro).

These tests which, depending on the situations, involved the European Central Bank (ECB), national central banks of the euro area, the Treasury, the Interbank Services Company – Sociedade Interbancária de Serviços (SIBS) – and most Portuguese Financial Institutions, were intended to test the "rollover from 1999 into the year 2000" and the "leap year".

The results obtained allow to conclude that the SPGT, the Automated Clearing Subsystems and the TARGET are compatible with the Year 2000, and that the participating institutions are able to process Year 2000 dates, as well as the rollover from 1999 into 2000.

The Year 2000 problem arises from the fact that the representation of the years, in data processing and information systems, uses only two digits. The utilisation of that simplification to represent the years in programmes (systems and applications), should compliance with the Year 2000 fail to be ensured, may lead to incorrect results when working with dates outside the 1900-1999 range. There is still another aspect of a more specific nature, which consists in counting the number of days of the Year 2000, since it will be a leap year.

The Banco de Portugal has been implementing an action plan intended to successfully integrate the different components, systems, services and activities that may be affected by the Year 2000 problem. This plan covers both the internal and the external segments of its activities.