S&P To Include Hacking Risks In Credit Rating Of Asia-Pacific Banks |#Cybersecurity |
As rapid evolution is sweeping through inter-connected banking on digital platforms, international rating agency Standard and Poor’s (S&P) said it is integrating threats of hacking into the rating of financial institutions.
The agency asserted that because of the major data breaches across Asia-Pacific banks, they are more vulnerable to cyberattacks. Aside from cultivating unrestrained monetary losses, data breaches can harm the prestige of a bank and hit its credit profile.
Asia-Pacific Banks Vulnerabilities Targeted
The agency added that in regions where the whole enterprise suffers crucial data breaches frequently, or where regulators are exceptionally lax, adverse rating tempo could result.
Nico DeLange, at S&P Global Ratings, asserted that while they have not devalued any Asia-Pacific bank as a result of a cyberattack, the hit to private institutions could be incapacitating. This could be very true for banks that have not staked enough on their cybersecurity.
Asia-Pacific financial establishments are increasingly on the cloud, distributing customer data with a fintech firm, or depending on third-party service providers.
Moreover, with the expansion of new members into a digital structure, hackers gain new access to entry. Assailants targeting establishments with vulnerable security could go through into the data of larger, strongly-defended banks.
Australia, Hong Kong, Singapore, South Korea, mainland China, India, New Zealand, and Japan are in numerous phases of executing open banking.
Risk Management System Through Collaboration
A leading bank could ally with a minor fintech firm that realistically may not have the aid for a healthy cyber defense..
To avoid raids, Asia-Pacific regulators will need a tenacious resolution to discern and manage risks, however, this leads to the demand for partnership and cross-border data sharing to erect cyber resilience across all establishments to deter systemic risk.
Furthermore, Asia-Pacific banks often depend on collaborators for their cloud computing and open banking outlets. This pertains to a new set of risks.
Researchers stated that Amazon Web Services (AWS), Google Cloud Platform, IBM Cloud, Oracle Cloud, and Microsoft Azure influence about 80% of the cloud service market. These five establishments have permits for crucial banking databases and support core banking services.
