The European Central Bank (ECB) has embarked on a critical initiative this month, conducting cyber stress tests on 109 banks across Europe.

According to Bank Info Security, these tests are designed to evaluate the banks’ resilience to cyberattacks.

Banks are required to undergo vulnerability assessments and incident response evaluations, with a deadline set for mid-2024. The ECB plans to simulate disruptive cyberattacks in these tests, scrutinising the banks’ response and recovery capabilities.

A unique aspect of these stress tests is the inclusion of third-party service providers, acknowledging the risks associated with outsourcing IT processes.

“Banks try to save costs by outsourcing some of their IT processes, but that is not always compatible with sound risk management. Banks should also understand the risks attached to outsourcing”, said European Central Bank supervisory board member Anneli Tuominen.

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