As a world first, banks in Britain may soon need to comply with a new set of rules for coping with cyber-attacks. Since the large theft from Tesco Bank customers at the end of last year, regulators are keen to put cybersecurity high on their to-do-list. It may be important to have enough capital to safeguard customers, but that on its own is not enough.
Sam Woods, Bank of England Deputy Governor, believes much more needs to be done to tackle the cyber security threat, especially as the regulators’ emergency response system has been triggered six times it the past 12 months.
Mr Woods states that he believes there will be three levels of tolerance. The lowest would be activities regulated by the FCA. The second layer would examine whether the solvency of the firm being hacked was robust enough and be monitored by the PRA. The third layer would be set by the BoE’s Financial Policy Committee.
So when can you expect to hear more on the issue? Mr Woods has indicated that this will be discussed at the FPC and PRA later this year or early next.
To read Sam Woods’ comments, please click here