Banks Face Mounting Risks Beyond Cash Rate
(4 October 2022 - Australia) The Reserve Bank of Australia's (RBA) unprecedented interest rate rising cycle compounds mounting cybersecurity and climate change risks occupying a growing share of financial and operational risks for Australian Banks.
The RBA’s latest financial stability review only confirmed this, citing the growing importance of building cyber resilience and acting on the climate over what it assetts were yet-to-be experienced increases in bad debts.
Financial institutions are coming under greater pressure from regulators to build cyber resilience, at the same time as they are being forced to move from measuring climate risks to mitigating them. APRA is preparing a climate vulnerability assessment to reveal the extent of risks at the Big Four majors and Macquarie.
"The threat of a significant cyber incident remains high, and such an incident could have implications for financial stability,” the RBA review stated, highlighting the broader implications for the economy.
“The recent Optus cyber incident where data for a large number of customers was compromised demonstrated that there can be indirect implications for the financial system of cyberattacks.”