Cyberattacks on Vendors Pose Threat to Banks, According to Survey

BRENTWOOD, TENN., August 29, 2017 – Forty-four percent of bank executives and directors say their bank would be vulnerable if one of its vendors experienced a cyberattack or data breach, according to Bank Director’s 2017 Technology Survey, sponsored by the technology solutions provider CDW. Just 21 percent believe the bank would be safe in such an event. This could be a growing concern for an industry that increasingly relies on outside relationships to provide the technology to serve customers and run the organization effectively.

However, 77 percent of respondents are confident that the staff and board of the bank would be prepared to react if the institution itself experienced a cyberattack or data breach.

The survey was conducted in June and July of 2017, and surveyed 145 chief information officers, chief technology officers, chief executives, independent directors and chairmen of U.S. banks above $250 million in assets. Chief operating officers, chief financial officers, chief marketing officers and other senior executives also responded.

Respondents also reveal that banks continue to struggle with data analytics—despite working in an industry flooded with customer data. Just 13 percent believe that their financial institution effectively uses data to serve the needs of existing customers or identify new customers. Yet, 65 percent indicate that data analytics will impact their financial institution over the next five years.

Other key findings include:

  • Fifty-three percent of respondents report that their bank’s technology budget increased between 5 and 10 percent for fiscal year 2017, and 21 percent report an increase of 15 percent or more.
  • Despite increased technology budgets, 61 percent of responding executives say that data analytics doesn’t represent a sufficient portion of the bank’s technology budget. Twenty-one percent say the bank hasn’t designated any money for data analytics.
  • Forty percent say their bank dedicates staff exclusively to data analytics, either by hiring new employees (20 percent) or shifting current staff to focus on the issue (20 percent). Forty-four percent, all at banks below $5 billion in assets, indicate that current staff focus on data in addition to other duties at the bank.
  • Forty-five percent indicate that their institution’s management team and board are open to working with newer fintech startup firms to help the bank implement new products and services or create efficiencies within the organization. However, 46 percent say bank leaders haven’t even considered working with startups.
  • Forty-seven percent indicate that the board discusses technology at every board meeting.
  • Fifty-six percent say the board does not have a sufficient level of expertise regarding technology.
  • Eighty-nine percent of bank directors and chairmen say they primarily rely on bank IT staff to stay informed of technology trends related to the banking industry.

Full survey results are available online at BankDirector.com and will be featured in the 4th quarter 2017 issue of Bank Director magazine.

Since 1991, Bank Director has served as a leading information resource for the directors and officers of financial institutions. Through its print and digital editions of Bank Director magazine, executive-level research, annual conferences and its website, BankDirector.com, Bank Director reaches the leaders of the institutions that comprise America’s banking industry. Bank Director is headquartered in Brentwood, Tennessee.

Source: BankDirector.com

Contact: Michelle King, chief brand officer, (615) 777-8465, [email protected]

Tricia Lesh

Vice President of Marketing

Tricia Lesh is Vice President of Marketing for Bank Director and manages the production and development projects for BankDirector.com and FinXTech.com. In addition, Tricia is focused on leading the direction of the company’s marketing, public relations and branding initiatives. A graduate of Belmont University, Tricia has more than 20+ years of experience in the financial industry, working in institutions with assets ranging from $500 million to $2.2 billion.