BoJ Network Forbids Work-From-Home Traders
The restrictive trading network of Japan's central bank is preventing employees involved in related asset sales from working from home despite still threatening levels of daily coronavirus infections in Tokyo exceeding 100.
The BoJ currently doesn’t allow home computers to connect with its trading network, Bank of Japan Financial Network System (BOJ-Net), preventing staff from conducting related asset sales and other market activities from working from home.
According to a «Bloomberg» report, inquiries about potential changes from at least three unnamed sources have been rejected, widely believed to be due to concerns about cybersecurity risk from connection to unknown computers.
Meanwhile, Tokyo continues to register a relatively high number of daily cases of coronavirus infections which have now totaled nearly 18,000.
Old School Processes
According to the sources, the process to sell government bonds to the BoJ is a tedious one that requires two employees – one to enter the assigned transaction amount and the other to check for accuracy. Amongst primary dealers, staff are also required to be in the office to participate in government debt auctions.
Currently, 56 registered financial institutions have designated office computers connected to the BOJ-Net to sell bonds to the central bank. Of the registered firms, 21 are primary dealers that use the network to bid at the government debt auctions.
Nationwide, Japan’s business culture is oft-cited for a plethora of relatively outdated processes like the still widespread usage of fax or paper-heavy internal dealings. Recently, Mitsubishi UFJ said it would adopt robots to process 300 million pages of physical client documents – a move that is estimated to save over 500 years of time under existing practices.
Low Growth, Hard Work
Security issues aside, financial firms linked to the BOJ-Net have strong incentives to keep their office staffed as bond sales to the central bank represent a rare source of revenue in Japan's traditionally low-growth economy which is likely facing more coronavirus-linked tailwinds.
The BoJ has already made concessions as a result of the pandemic, the report added, allowing for the usage of designated computers from backup offices and the option for traders to fax orders.
