Hungarian Banks Face Compliance Challenges in Cloud Transformation

As Hungarian financial institutions embark on cloud transformation projects, they face not only IT and technology risks but also compliance challenges. The National Bank of Hungary (MNB) sets strict regulations for smooth operations.

Compliance Requirements for Hungarian Banks

MNB’s 4/2019 Recommendation: Cloud Risk Analysis

The “cloud recommendation” requires financial institutions to undergo thorough gap assessments and cloud risk analyses before migrating to the cloud.

Gap Assessments: Identify vulnerabilities in current systems and processes.
Cloud Risk Analysis: Evaluate potential risks associated with cloud migration.

Information Security Risk Assessments (ISRA)

Government decree 42/2015 mandates regular ISRAs, which must be conducted at least every other year. To meet this requirement:

Independent Risk Assessments: Conducted by an independent third-party expert.
Actionable Insights: Provide banks with recommendations to mitigate potential threats.

Physical and Human Security Risk Assessments

Government decree 42/2015 requires banks to conduct regular risk assessments and implement adequate countermeasures. An independent review can help identify vulnerabilities and provide recommendations for improvement.

Physical Security: Evaluate the security of bank premises, systems, and data.
Human Security: Assess the security of employees, contractors, and third-party vendors.

Remote Client Identification Processes

MNB regulation 26/2020 requires remote client identification processes to be validated by an independent party at least every other year. The consultancy firm has experience reviewing common solutions used in the Hungarian market.

Validation: Ensure that remote client identification processes meet regulatory requirements.
Review of Common Solutions: Assess the effectiveness of commonly used solutions in the Hungarian market.

System Integrity Reviews

Government decree 42/2015 and legislation Bszt. (2007. CXXXVIII.) require system integrity reviews to be conducted by an independent third-party expert. These reviews help identify vulnerabilities and ensure that systems meet regulatory requirements.

System Integrity: Evaluate the security, reliability, and performance of bank systems.
Regulatory Compliance: Ensure that systems meet MNB regulations and legislative requirements.

Expertise is Key in Cloud Transformation and Compliance

As Hungarian banks navigate the complexities of cloud transformation and compliance, expertise is essential to avoid pitfalls and ensure smooth operations. The consultancy firm’s proprietary IT risk assessment tool and experience in reviewing common solutions used in the Hungarian market make them well-equipped to help financial institutions meet MNB regulations and stay ahead of the curve.