The Depository Trust & Clearing Corp., which processes financial transactions and stores securities, has begun the long process of recovering about 1.3 million soaked securities that were stored in a 10,000-square-foot underground vault in a lower Manhattan skyscraper flooded by Superstorm Sandy.
The company declined to disclose the value of the stocks and bonds. But it was a “very small percentage” of the $39.5 trillion of stocks and bonds that its depository stores, DTCC spokeswoman Judy Inosanto said. The percentage of securities that are handled electronically are in the “high 90s”, she said.
Inosanto declined to say when the company was able to open the vault at 55 Water Street, which was flooded more than two weeks ago by surges churned by Superstorm Sandy. But when it did, DTCC found significant flooding and water damage.
“While it is premature to determine the full extent of the damage, it is essential to begin the restoration process to avoid further deterioration,” the company said in a statement.
DTCC said the recovery effort is more of “an administrative and logistical challenge than an economic issue.”
It maintains a vast certificate inventory file with ownership information, which can be replicated from its data centers. The company said its computer records are intact, and includes detailed inventory files of the vault’s contents.
DTCC has retained disaster recovery and expert restoration firms, but declined to identify them. It said it could not yet determine how many of the physical certificates can be restored. But it expects to have a more accurate assessment of their condition in about a week. The restoration process could take months, it said.
The company said it is in discussions with various transfer agents to establish a procedure to issue replacement certificates, without requiring the original certificates to be present.