Singapore Central Bank Highlights ’Evolving Threats’ In New Business Continuity Guidelines

June 13, 2022
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The Monetary Authority of Singapore (MAS) has issued revised guidelines for business continuity in response to novel threats faced by financial institutions.

The Monetary Authority of Singapore (MAS) has issued revised guidelines for business continuity in response to novel threats faced by financial institutions.

Published on June 6, the latest Guidelines on Business Continuity Management (BCM) are designed to promote stability and resilience among institutions that are key to Singapore’s financial system.

The guidelines have been revised due to what the MAS describes as an “increasingly complex” threat environment that includes IT outages, pandemics, and both cyber and physical attacks.

To ensure that such risks do not pose systemic threats to Singapore’s financial system, the new guidelines urge financial institutions to identify and eliminate single points of failure within their operations.

The guidelines also encourage financial institutions to put in place controls that reduce the risk of operational disruptions, and in the event that such disruptions take place, measures to minimise their impact and allow services to resume as quickly as possible.

Taking into account Singapore’s handling of the pandemic and its increased stress on digitised financial services, financial institutions in Singapore are asked to adopt a service-centric approach and focus on timely recovery of customer-facing services in the event of operational shocks.

They must also identify end-to-end dependencies that support critical business services, and address any gaps that could hinder the effective recovery of such services.

Lastly, they must enhance threat monitoring and environmental scanning, and conduct regular audits, tests and industry exercises to maintain business continuity readiness.

“Against the backdrop of an increasingly volatile and complex environment, the new guidelines will help financial institutions take an agile and holistic approach in sustaining their critical business services when faced with threats and risk of disruption,” said Vincent Loy, assistant managing director for technology at the MAS.

In a statement, the MAS noted that the revised guidelines were strengthened by two rounds of public consultation with industry stakeholders.

The BCM guidelines were first issued to the financial industry in June 2003. Subsequently, an addendum was issued in January 2006 to provide further guidance on measures to mitigate the impact of an influenza pandemic and security threats arising from terrorism.

Philippines safeguards against systemic risk

Elsewhere in the region, other central banks are also taking steps to ensure business continuity in response to evolving threats.

In the Philippines, the Financial Stability Coordination Council (FSCC) has published its latest Systemic Risk Crisis Management (SRCM) Framework, as part of its mandate to enhance financial system resilience.

The SRCM framework identifies key actions required to assess, categorise, manage and communicate systemic risks.

The framework covers continuous surveillance of risk-related trends, review of infrastructures, conduct of systemic stress tests and arrangements for communication, both under normal and stressed conditions. It also covers climate-related and cybersecurity risks.

The FSCC is an inter-agency council composed of the central bank (Bangko Sentral ng Pilipinas - BSP), the Department of Finance, the Insurance Commission, the Philippine Deposit Insurance Corporation (PDIC) and Securities and Exchange Commission (SEC).

It is the venue for financial market authorities to identify, monitor, manage and mitigate the build up of systemic risks in the Philippine financial system.

The BSP defines systemic risks as those that can cause financial system disruptions either by external shocks or through internal risk-taking and mismanagement.

A risk is considered systemic if disruptions caused in one area, or in the whole of the financial system, have the potential to adversely affect the broader economy.

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