Hurricane Ida made landfall in south Louisiana on August 29, exactly 16 years after Hurricane Katrina devastated Louisiana and Mississippi. In 2005, Katrina flooded New Orleans, causing 1,800 fatalities and $125 billion in damages. After Katrina, the city invested $14.5 billion to improve its flood protection infrastructure.

Although New Orleans’ levees resisted Ida’s landfall, the storm still caused havoc. The power grid failed in Mississippi and Louisiana, leaving more than 1 million customers in Louisiana without electricity during a heatwave. Power outages lasted weeks in the hardest-hit areas.

The storm caused catastrophic wind gushes, floods and tornadoes in several U.S. northeastern states. On September 1, New York City registered the wettest single hour on record, at 3.15 inches (80 mm), prompting the authorities to declare its first-ever flash flood emergency. Dozens died across the United States.

Financial Infrastructure Shuts Down

On August 27, in preparation for Ida’s arrival, Stanley M. Dameron, commissioner of the Office of Financial Institutions of the State of Louisiana, authorized financial and non-depository organizations to temporarily close or relocate branch offices, as well as limit hours, reduce functions, or close certain days of the week.

Bank Closures

• Banks in unaffected communities, such as the Merchants & Marine Bank in Pascagoula, Mississippi, supplied their peers in Louisiana with latex gloves, bleach, paperSee Banknote paper. More towels, and toilet paper. “We really believe in bankers helping bankers,” said Clayton Legear, the bank’s president and CEO.
• On August 31, JPMorgan Chase reopened more than a dozen branches in Baton Rouge, the capital of Louisiana. On September 1, at least 45 of JPMorgan Chase’s units in the New Orleans area were still closed. “Many branches are physically in good condition; however, power or connectivity issues mean their reopening dates are undetermined at this point,” said Steve Nivet, a consumer banking regional executive.
• Gulf Coast Bank & Trust in New Orleans’ backup systems were able to process wires and service its digital banking platform, according to Guy Williams, its president and CEO. Its 45 offices remained closed on August 31, and only five reopened on Tuesday, September 1.
• In McComb, Mississippi, a branch of Pike National Bank was still closed through September 1, according to president and CEO Jennifer Wallace. Pike officers were calling local businesses to ask if they needed cashMoney in physical form such as banknotes and coins. More or changeThis is the action by which certain banknotes and/or coins are exchanged for the same amount in banknotes/coins of a different face value, or unit value. See Exchange. More, said Wallace.

Failures in the Electronic Payments Infrastructure Increased Disaster Risks

In New Orleans, some supermarkets like Whole Foods accepted debit or credit purchases only and refused to provide cashbackA service whereby the customer pays electronically a higher amount to a retailer than the value of the purchase for goods and/or services and receives the difference in cash. It is also a reward system associated with credit card usage, whereby the consumer receives a percentage of the amount spent on the credit card. More to customers. Other retailers like Dollar General, restaurants, hardware stores, and pharmacies remained open but accepted cash payments only.

During the Covid-19 pandemic, Louisiana had about 930,000 people needing food assistance. However, “layer on top of that, all those people that are normally food secure but have no power and no ability to shop and buy groceries and you’re talking a million-plus people in the state that need help,” said Natalie Jayroe, president and chief executive of the Second Harvest Food Bank.

Always Have Cash Ready in your Emergency Kit

Local bankers thought the recovery would depend significantly on restoring electricity and water services. “Having lived through this a few years ago, the restoration of infrastructure is key,” said Art Stevens, president of retail banking at Trustmark Bank in Jackson, Mississippi. “The roads have to be cleared and opened, the power has to come back on, the water and sewer has to work, really before full recovery can even start to take place.”

U.S. federal disaster preparedness advice at Ready.gov recommends citizens have a basic supplies kit including “cash or traveler’s checks.” The Federal Emergency Management Agency (FEMA) also urged New Orleans residents to stock up on cash in preparation for Ida’s landfall.

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