The 9.0-magnitude earthquake that struck Japan on March 11 was an unprecedented test of Tokyo-based money managers' business continuity plans.
Executives there said the industry came through that trial with flying colors, if a bit shaken and stirred.
“I've worked in half a dozen different countries in this industry, and it really was impressive how the whole industry” — from money managers to brokers and custodians — “reacted so quickly and competently,” said Timothy McCarthy, chairman and CEO of Tokyo-based Nikko Asset Management Co.
It wasn't easy. Investment executives in the temblor-prone capital said the earthquake, which occurred 20 minutes before the Tokyo Stock Exchange was set to close for the weekend, was more violent than anything they had previously experienced. It paralyzed or disrupted offices, trains, phone lines and information systems.
Tokyo-based executives downplayed the obstacles they overcame in light of the horrors visited on the Tohoku region, 180 miles to the north, where tsunamis destroyed a swath of coastal cities and villages, killing more than 5,000 people at last count.
Still, the challenges they faced were considerable, from navigating the city's soaring skyscrapers without elevators to confirming last-minute trades and fixing the net asset values of funds over unreliable phone and computer lines and even finding food.
Edwin Merner, president of Tokyo-based Atlantis Investment Research Corp., said the earthquake had “the highest intensity I ever felt” in more than 30 years. The quake emptied shelves and knocked over bookcases and filing cabinets in his firm's offices on the 18th floor of a skyscraper in central Tokyo.
The typical Tokyo earthquake subsides within a matter of seconds, but this one “just kept getting stronger and stronger,” said Ryo Ohira, managing director and head of Neuberger Berman Japan. The quake found the Neuberger team gathered in the company's conference room, a veritable “wall of glass” on the 10th floor of a 35-story building, facing the street.
For the first five minutes, “the rolling was very intense,” and amid the aftershocks, the following 30 or 40 minutes were like being on a ship in rough seas, said Nikko's Mr. McCarthy. “It was really hard to just physically move.”