Financial Crime World

Financial Institution Cybersecurity Risks on the Rise in KSA

Introduction

The Kingdom of Saudi Arabia (KSA) has been making significant strides in its Vision 2030 initiative, aiming to transform the country’s economy and society. However, one major challenge that continues to plague the financial sector is cybersecurity risk.

As financial institutions increasingly rely on digital technologies to conduct business, they become vulnerable to cyber threats that can compromise sensitive data, disrupt operations, and erode customer trust.

Cybersecurity Frameworks: A Critical Component of Risk Management

The Saudi Arabian Monetary Authority (SAMA) has established a comprehensive Cyber Security Framework to guide financial institutions in identifying and managing cyber risks. The framework is based on widely accepted industry standards such as those of the National Institute of Standards and Technology (NIST), the International Organization for Standardization (ISO), and the Basel Committee on Banking Supervision.

The Four Domains of the Cyber Security Framework

  1. Cyber Security Leadership and Governance: Establishing a clear cyber security strategy, assigning responsibilities, and implementing incident response plans.
  2. Cyber Security Risk Management and Compliance: Identifying, assessing, and mitigating cyber risks; ensuring compliance with relevant regulations and standards.
  3. Cyber Security Operations and Technology: Implementing robust security controls, monitoring systems, and maintaining up-to-date technologies.
  4. Third Party Cyber Security: Assessing and managing the cyber risks associated with third-party vendors and suppliers.

Measuring Compliance: SAMA’s Cybersecurity Maturity Model

To ensure compliance with its Cyber Security Framework, SAMA has developed a cybersecurity maturity model that assesses an institution’s ability to manage cyber risks. The model evaluates institutions based on five maturity levels:

  • Zero: No formalized policies or procedures in place.
  • One: Basic understanding of cyber security principles and some controls implemented.
  • Two: Formalized policies and procedures, but limited implementation and monitoring.
  • Three: Comprehensive policies, procedures, and controls in place, with regular monitoring and testing.
  • Four: Continuous improvement and innovation in cyber security practices.

Institutions are expected to operate at a minimum maturity level of three to effectively manage internal cyber security programs and mitigate risk.

The Demand for Cybersecurity Professionals Exceeds Supply

According to various reports, the global market for cybersecurity professionals is experiencing a significant shortage. This trend is particularly evident in KSA, where financial institutions face challenges in recruiting and retaining skilled cybersecurity talent.

To address this gap, organizations have resorted to outsourcing cybersecurity services or partnering with third-party providers who possess the necessary expertise. This approach enables them to leverage specialized knowledge and resources, thereby enhancing their overall cyber security posture.

Mitigating Cybersecurity Risks: Expert Advisory Services

HKA’s Cybersecurity Risk and Privacy team provides expert advisory services to help organizations assess and improve their cybersecurity posture. Their services include:

  • Risk management and governance
  • Third-party and vendor risk management
  • Incident response
  • Data retrieval and analysis
  • Awareness and training

Their experienced investigators understand the complexities of internal operations, enabling them to identify vulnerabilities and provide targeted recommendations for improvement.

Conclusion

The financial sector in KSA is facing significant cybersecurity risks that can compromise sensitive data, disrupt operations, and erode customer trust. However, by understanding these challenges and implementing effective solutions, organizations can mitigate these risks and maintain a robust cyber security posture.

Ultimately, it is essential to recognize the importance of continuous improvement and innovation in cyber security practices, as well as the need for specialized expertise and resources. By working together, financial institutions can create a safer and more secure environment for their customers, employees, and stakeholders.