Report says financial institutions that prepared for disaster benefited the most U.K. financial institutions need to think ahead and communicate more when faced with a crisis such as a terrorist attack that could dramatically affect their operations, according to a report issued by top financial authorities.The recommendations come five months after a market-wide exercise was held in London’s financial district, organized by the Tripartite Authorities, a group comprising the Financial Services Authority, the U.K. Treasury Department and the Bank of England.The scenario integrated U.K. government authorities and law enforcement with the private sector, testing how institutions would be able to quickly react to a disaster. The drill started with a breakdown in the interbank transfer systems, followed by terrorist “bombings” around London. An executive summary of the report was released, and a private report was issued to organizations that participated, said Rick Cudworth, a partner at consulting company KPMG LLP who heads the firm’s Business Continuity Services.KPMG and crisis-readiness firm Crisis Solutions Ltd. coordinated the exercise, which included on-site monitors to record how organizations reacted. More than 80 businesses, including large banks such as HSBC Bank PLC, participated in the exercise, held last November.Institutions were faced with decisions such as whether to move operations to back-up sites, how to ensure safe transportation of employees and how to react decisions by U.K. civil authorities. “We found that people were very focused on the very immediate issues,” Cudworth said. “It was a quite fast-moving event, and many people seemed to deal with what was coming at them.”Ideally, institutions should also be able to think ahead about other potential situations that could arise and the effect on their operations, the report said. Organizations also underestimated the effect of civil actions, such as police cordons, that restrict access to buildings.Unsuprisingly, the report said those organizations that prepared for the drill benefited the most. It also suggested refinement of the Financial Services Authority damage assessment tool, with more attention on how it can be kept up to date as information changes. The report stressed better communications among institutions themselves as well as government authorities.“We are emphasizing, again, that no organization is an island,” Cudworth said. Security