On June 30, 2015, the world will once again experience a “leap second,” where one second is added to the clock. As a result, there will actually be civilian clocks reading 23:59:60 on that day. (Leap second has no impact on atomic clocks and any thing that uses atomic clocks, like GPS). The extra second will be added as 23:59:60 UTC—that’s 8 PM Eastern time and 5 PM Pacific.
How could the addition of one second adversely affect a financial institution? It can if its computer system acting as a timekeeper cannot handle 23:59:60 as a time setting. Frequently, this means computers running UNIX or LINUX, but others can be affected as well. In the past, the addition of a leap second has reportedly knocked systems and web sites offline for hours.
To address the leap second in 2015 and any possibility of computer malfunctions, the parent of the New York Stock Exchange has announced that it will cease trading (“delay market state transitions”) for 61 minutes between 23:00 UTC and 00:01 UTC (7 PM to 8 PM Eastern). The reason behind the leap second is that the Earth’s rotation is slowing very, very slightly. In order to help harmonize civilian and atomic clocks, the leap second is added to the civilian clock. (The Time Service Department of the US Naval Observatory pointed out that “it is not possible to alter the Earth’s rotation speed to match the atomic clocks”).
The leap second occurs only once every three or four years: the preceding leap second was added in June of 2012; the leap second before that was added in December of 2008.