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ECB tells banks to step up defences against hacks

FILE - The Euro sculpture stands in front of the European Central Bank, right, in Frankfurt, Germany, in this Dec.16, 2011 file photo. The European Central Bank took bold steps Thursday June 5, 2014 to protect Europeís fragile economic recovery, cutting interest rates and offering to pump more money into the financial system. (AP Photo/Michael Probst, File)

The European Central Bank is telling euro zone banks zone to step up their defences against cyber-attacks. The ECB’s supervisor stated that this is also in the context of geopolitical tensions such as the stand-off between Russia and Ukraine. Andrea Enria was presenting the results of the ECB’s annual review of banks. This showed that the industry had coped well with the pandemic. Their capital relief measures could be allowed to expire at the end of this year.

But the euro zone’s top banking supervisor warned of rising risk from cyber-attacks. Enria told media that they are asking the banks to strengthen their cyber regime measures and look at a potential increase in attacks. The ECB was telling banks to train staff so that they could tackle this threat. They can also look for weak spots in services they outsource. The central bank has also been running simulated hacks for years.

Enria said that the ECB would draw the attention of banks in relation to the potential worsening of global tensions that could indeed trigger more attacks. Also, added that the six euro zone banks out of the 115 it supervises had fallen short of ECB’s capital demands at the end of September 2021. And that was due to structural issues such as low profits, rather than the pandemic.

They are broadly satisfied with the way that banks have operated so far during the pandemic. Banks need to remain aware of the possible consequences for their balance sheets. They should strengthen their risk control and governance frameworks in particular. Enria also added a waiver allowing banks to use some of their capital buffers.

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