Cyber risk remains greatest industry threat, says survey

Cyber risk remains the greatest threat to the financial services industry, according to research from the Depository Trust and Clearing Corporation (DTCC).

Cyber risk remained the top overall risk, with 22% of respondents citing it as the single biggest threat to the industry and 56% rating it a top-five concern, consistent with survey results from DTCC’s last poll conducted six months ago.

Results of the survey suggested that the cyber threat is particularly relevant for the financial industry due to the interconnected nature of global markets.

One respondent was quoted as saying “a cyber attack against a key market participant could precipitate systemic risk and de-stabilise markets.”

The emergence of the cyber threat and ways to tackle it has dominated recent industry coverage.

Speaking to Global Custodian at September’s Sibos event, Deutsche Bank’s head of securities services, Satvinder Singh, highlighted the importance of providing additional training to staff to address the constantly evolving cyber threats.

Other results from the DTCC survey revealed that geopolitical risks were also considered a threat, with 50% of respondents citing the outcome of the 2016 US presidential election as a top-five risk.

General geopolitical risk, including the influence of Russia and China on global relations and the world economy, and Britain’s decision to leave the European Union were cited by 38% and 33% of respondents as a top-five risk, respectively.

The results also identified regional differences with North American respondents proving to be more concerned about cyber security, decreasing liquidity and a sudden dislocation in financial markets than respondents elsewhere.

Alternatively respondents outside of North America are significantly more concerned about the impact of Brexit as well as economic slowdowns in Europe and Asia.