GCC Banks’ Strong Liquidity Supports Cyber ​​Risk Resilience – News

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According to cybersecurity experts, the top cybersecurity threats in 2022 for banks include ransomware, ongoing remote working risks, rise in cloud-based cyberattacks, social engineering and blockchain attacks. ‘supply.



Published: Wed 18 May 2022, 7:22 PM

Last update: Wed, May 18, 2022, 7:25 PM

According to S&P Global Ratings, GCC banks are effectively managing their exposure to cyber risk by investing in digital security.

While GCC banks have reported only a handful of minor cyberattacks over the past decade, cyber risk management has taken on greater importance as banks in the region have shifted their activities to platforms online during the pandemic, the rating agency said in a report.

“This change was made with minimal disruption, thanks to years of investment in infrastructure and systems. At the same time, banks’ strong profitability, capitalization and liquidity provide financial protection against potential incidents,” S&P Global Ratings said in its report “Gulf Banks’ Strong Capitalization Supports Resilience to Cyber ​​Risk.” .

Guidewire, a cybersecurity specialist, estimates that the region’s top 19 banks would suffer an average drop of 7.5% in net profit and a drop in equity of 0.6%, based on end figures. 2021, under high-severity cybersecurity. incident; at the same time, the average operational risk capital requirement for banks was 3.6 per cent of total capital. “We believe the data suggests that GCC banks appear to have sufficient operational risk capital to cover cyber risk losses.”

According to cybersecurity experts, the top cybersecurity threats in 2022 for banks include ransomware, ongoing remote working risks, rise in cloud-based cyberattacks, social engineering and blockchain attacks. ‘supply.

They said weak cybersecurity in the banking industry can compromise customers. The cost of recovering from a breach can be huge and time-consuming.

In the first half of 2021, ransomware attacks in the banking industry increased by 1318%, which was disproportionate to other industries, according to a Trend Micro report.

The New York Federal Reserve noted in a report that financial firms experience 300 times more cyberattacks than other sectors, highlighting how attractive this sector is to cybercriminals.

Analysts said the top reasons to be vigilant about cybersecurity trends include: An increase in cashless transactions means that more financial transactions than ever before are digital.

The risk of cyberattacks appears even higher for banks with greater geographic diversification, especially those operating in regions more prone to cyberattacks than the GCC, and banks with extensive retail operations, which have been found to be more susceptible. to attract the interest of hackers.

Guidewire’s findings suggest that the cyber risk profile of GCC banks is comparable to that of developed markets, rather than that of banks in emerging markets.

“It should be noted that emerging markets are significantly more prone than GCC to indirect business interruption issues, which stem from issues at third-party service providers. This could be explained by the large investments of the GCC countries in infrastructure, which seem to have reduced the indirect risks of business interruption,” the S&P report states. [email protected]

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