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By Michelle Price and Imani Moise
WASHINGTON/NEW YORK, Feb 28 (Reuters) - Big U.S. banks have been rolling out contingency plans to respond to the global coronavirus outbreak - requiring some staff to work from home, implementing travel restrictions, and talking to regulators about potential stresses.
The preparations come amid growing fears that the fast-spreading virus which has infected around 83,000 people in more than 50 countries could lead to a global recession. Stock markets have plunged, with the S&P 500 index dropping 11.5% this week, the worst showing since the 2008 financial crisis.
Banks are not the only companies affected by the spread of the disease, but their position as market intermediaries and custodians of critical infrastructure has put the health of their employees, operations, and balance sheets in the spotlight.
On Friday, U.S. presidential candidate and Massachusetts Senator Elizabeth Warren sent a letter to the five largest U.S. banks asking how they are preparing to mitigate the risks of the outbreak.
"As a globally systemic important bank, your institution and the customers it serves could be impacted either directly through exposures to areas where the virus has spread or indirectly through a change in market conditions," she wrote.
Financial firms started dusting off long-standing contingency playbooks several weeks ago when the virus was spreading through China, two industry officials told Reuters.
Big U.S. banks are in daily contact with federal, state and local regulators on a range of issues, sources said, but lately coronavirus preparations have taken center stage. Discussions have centered around how to keep markets, transactions and other banking functions operating smoothly, as well as handling employee quarantines.
One major bank brought an epidemiologist into its regular risk management gathering on Friday morning, a person who attended the meeting told Reuters.
JPMorgan Chase & Co, the largest U.S. bank by assets, told employees on Thursday that it was restricting all but essential international work travel due to the continued spread of the virus.
Citigroup Inc has restricted business travel in all Asian countries and Italy, and has asked employees who have visited affected areas to work from home for 14 days, a person familiar with the matter said. The bank has also imposed short-term restrictions on large meetings that require international travel.
Earlier this week, Morgan Stanley and Goldman Sachs Group Inc asked attendees of several conferences they are hosting in the coming weeks to disclose if they or people they have close contact with have traveled to mainland China, South Korea, parts of Italy and Japan.