Call us now:
The Australian Prudential Regulator Authority (APRA) has informed Medibank that it will have to set aside an additional $250 million AUS in regulatory capital, to address issues following its 2022 cyber attack. As the regulator reviews the banks governance and risk Culture’.
Regulatory capital is held to accommodate risk events, it is capital that the bank cannot use for other purposes such as loans or investments. Setting capital aside has effected market sentiment and in the case of Medibank a ‘short-medium-term impact on stock’.
The APRA is moving quickly to address regulatory oversight and align capital to what it believes is Medibank’s risk exposure. One can expect the APRA to be looking more closely at Governance and Risk, specifically operational risk capital, of other financial institutions, in light of cybersecurity.
One recognised the importance of cyber risk as a separate risk category siting along side operational, credit and market risk. A reason for implementing a separate Cyber risk function, alongside Credit, Market and Operational risk under the Chief Risk Officer at Santander. One believes that the systemic nature of cyber attacks on financial institutions now warrants a separate risk category for FIs. As attacks on FIs demonstrate why cyber is a significant enterprise wide risk. A risk that effects Credit risk as regulation develops and cyber insurance cover is reduced.
Ted Dziekanowski Stephen Pitt-Walker, JD, FGIA Rachel V. Rose, JD, MBA
#cybersecurity #cyberriskmanagement #regulatorycapital #cyberattacks
View Original Post
https://www.linkedin.com/feed/update/urn%3Ali%3Ashare%3A7079350441817337856