The Central Bank of Nigeria(CBN) has urged commercial banks and other Financial Institutions (OFIs) to prepare against the rising threats of cybercrime in the financial system, in view of an increased recent targeted cyber-attacks on critical IT infrastructure.
Speaking at the 2nd National Risk Management Conference in Lagos yesterday, the CBN governor, Godwin Emefiele also stressed the need to collectively address the challenge of climate change in the face of the recent flooding experienced in some parts of the country
Emefiele, who was represented by the CBN director, Financial Markets department, Dr. Angela sere-Ejembi, at the event themed 'Risk Management in the Promotion of Financial System Development for Economic Growth,' noted that, effective risk management in the financial system is a catalyst for economic growth
According to him, given how extensively technology has altered the world today, being technology savvy has become a crucial requirement for risk managers today.
"Technological savviness is crucial for two reasons. First, technology can be harnessed to improve business operations and enhance risk management.
"Secondly, it allows us to quickly identify and respond to new sources of risks emanating from technological developments. The potential of technology in risk management is vast, not only for the automation of tasks, but increasingly as a tool for making business decisions as well.
"The application of big data analytics and artificial intelligence to assess and predict human behaviour, for instance, can provide great value to businesses in terms of reducing risks. Considering these issues highlighted, there is a need for risk managers to be quick in identifying and responding to cyber risks."
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He added that the CBN recently issued a risk-based cybersecurity framework and guidelines for OFIs, which represent the minimum requirements to be put in place by all OFIs, citing that, it is in addition to a series of fintech-based policies and guidelines which includes the regulatory sandboxes, open banking, and cybersecurity, among others was released by the apex bank to strengthen cyber security risk management in its determination to ensure a robust regulatory landscape without stifling innovation.
"Traditionally, financial institutions have predominantly focused on financial risk, but have made efforts in rebalancing over the past decade to strengthen non-financial risk management. However, over time, the lines between financial and non-financial risk have started to and will continue to blur. This is apparent when considering increased recent targeted cyber-attacks on critical IT infrastructure, the opportunities and risks presented by financial innovation driven by technological change (Fintechs), developments on the central bank digital currency, and our learnings from the recent response to the pandemic
"Technological disruptions experienced in the last decade has been forceful and impactful in all spheres of life. The rapid evolution of Fintech companies has continued to alter the financial landscape globally and developments have continued to disrupt traditional ways of offering financial services in the banking landscape," he pointed out.
