Bank of England Survey Issues Warning Of Cyber Threat To UK Financial System
Bank of England Survey Issues Warning Of Cyber Threat To UK Financial System
According to the Systemic Risk Survey conducted by the Bank of England, cyberattacks are the risk that UK financial system users most frequently identified as a danger.
ALSO, READ AM Best Downgrades Kemper On Earnings Deterioration
According to the bank, when asked to pick the five risks most likely to have the biggest impact, nearly three-quarters (74%) mentioned a cyberattack.
Geopolitical risk and inflation risk tied for second place in the survey, according to 72% of respondents. According to the Bank of England, these top three risks have not altered since the 2022 H1 survey. Political risk in the UK was ranked fourth, with a 34% rating. Following this, 23% mentioned climate risk and 31% mentioned pandemic danger.
Bank of England Survey Issues Warning Of Cyber Threat To UK Financial System
The Bank of England wrote: “Outside of the top six cited risks, other notable changes include respondents citing risk of an overseas/global economic downturn, which increased to 20%.
This is in contrast to this risk category being at its lowest level (6%) since the survey began for respondents in the 2022 H1 survey. The perceived risk of a UK economic downturn also increased to 20% (+6 percentage points).”
However, the risk most cited as the number one risk was respondents was inflation (38%), with cyberattacks and geopolitical risk named by 17% as the top risk.
ALSO, READ UK Car Insurance Premiums Increase By 6% As Industry Is Facing A “raft of challenges”: WTW
Respondents were also asked to indicate which three of the five risks they identified would be the most challenging to manage if they were to materialize. Inflation risk was cited by 61% of respondents, followed by a cyberattack (56%), geopolitical risk (48%), UK political risk (14%), climate risk (13%), and UK economic downturn (13%).
Worryingly, the Bank of England said that the perceived probability of a high-impact happening in the short term has increased significantly.
Bank of England Survey Issues Warning Of Cyber Threat To UK Financial System
It wrote: “The percentage of respondents judging that probability to be high or very high doubled from 31% to 62% since the 2022 H1 survey, compared to its peak of 73% in the 2019 H2 survey. Correspondingly, the percentage of respondents judging the probability in the short term to be low or very low decreased from 23% to 3%.”
ALSO, READ Global Crypto Adoption On The Rise Despite Market Uncertainty – Coinbase
It added: “Eighty-three percent of respondents believed that the probability of a high-impact event in the short term had increased over the past six months, a significant increase from 39% in the 2022 H1 survey. Fifteen percent of respondents believed that the probability remained unchanged and 2% judged the probability to have decreased.”
According to the Bank of England, the Systemic Risk Survey has been undertaken biannually since 2009 and was published for the first time in November 2011.
AllInsuranceHUB is a blog for everyone who seeks an informative, educative, and knowledge-based online insurance and investment community. We share Biographies, Top-notch investment tips, finance news, insurance policy details and much more. You can read and share thoughts, ideas, and opinions on the finance market and get real-time updates from around the globe.
