The risk of cyberattacks is slowing the implementation of Asia-Pacific financial institutions’ digital transformation plans, according to new research.
A report based on a survey carried out by Microsoft and research firm Frost & Sullivan, Understanding the Cybersecurity Threat Landscape in Asia-Pacific: Securing the Modern Enterprise in a Digital World, reveals that almost two thirds (63%) of financial institutions have had their digital projects derailed by cybersecurity concerns.
More than a quarter of respondents had either suffered a cybersecurity breach (27%) or, more worryingly, were unsure if they have had a security incident “as they have not checked”.
The survey, which canvassed 1,300 business and IT executives working at Asian financial institutions, found that cybersecurity breaches could cost the region as much as $1.75trn per year, equivalent to 7% of the region’s GDP.
The report concludes that each attack on a large institution costs an estimated $7.9m, the majority of which is through reputational damage and the consequent loss of customers.
“For banks and other financial services organisations, the potential loss of trust and the consequent reputation damage is a far greater threat than the economic impact of a cybercrime,” commented Kenny Yeo, industry principal for cybersecurity at Frost & Sullivan.
The vast majority of banks (81%) have turned to artificial intelligence tools as a way to combat cyberattacks, states the report. Cyber insurance, however, is not mentioned in the report as one of the means of mitigating cyber risk.
With so many banks investing in so-called digital transformation projects and then discovering that they increase exposure to cyber risk, the report’s authors advocate adopting “new digital business models that combine agility and security, with trust at the centre”.