Bank of England has decided to postpone a “war-gaming exercise” that it had announced in November to test the financial sector’s resilience to major cyber incidents, Reuters has revealed.
The exercise has been deferred by the bank’s Financial Policy Committee (FPC) to allow British banks to focus on their respective Brexit preparations and is expected to take place in the first half of 2019.
Assessing banks’ cyber-resilience
The exercise was announced by Bank of England on November 9th in partnership with HM Treasury, the FCA, UK Finance and dozens of other organisations “to test the financial sector’s resilience to a major cyber incident impacting the UK.”
“This exercise forms a vital part of the sector-wide biennial process that seeks to ensure the industry is prepared for – and can respond effectively to – any major disruption stemming from a cyber incident, protecting the financial system on which the public relies,” Bank of England said in a statement.
“The exercise will help authorities and firms identify improvements to our collective response arrangements, improving the resilience of the sector as a whole,” it added.
UK banks will survive a disorderly Brexit
Recently, Bank of England also carried out a stress-test of leading UK banks to assess how such banks would cope with sudden changes in the UK’s economy in the aftermath of Brexit. The likes of Barclays, HSBC, Lloyds, Royal Bank of Scotland, Standard Chartered, the UK arm of Santander and Nationwide building society were tested against factors such as “a 4.7% fall in UK GDP, a rise in unemployment to 9.5%, a 33% drop in house prices, a hike in interest rates to 4% and a 27% drop in the value of the pound”, according to The Guardian.
Following the completion of the stress test, Bank of England concluded that UK-based banks are “resilient to deep simultaneous recessions in the UK and global economies” and that the banking sector is “strong enough to continue to serve UK households and businesses even in the event of a disorderly Brexit”.