IT security vital for financial hub

The Monetary Authority of Singapore (MAS) has urged financial institutions in Singapore to ensure they maintain strong information technology security - and with good reason.

A spate of high-profile cybercrimes by sophisticated hackers targeting banks across Asia highlights how cyber security is an increasingly important issue for financial institutions.

Philippine banks had suffered "isolated" cases of cyber attacks resulting in small financial losses, Bloomberg reported on Tuesday.

These come on the back of a US$81 million (S$111.5 million) heist involving Bangladesh's central bank in February, when attackers moved the money to accounts in the Philippines.

And Vietnam's Tien Phong Bank said on Sunday that it had stopped a cyber fraud attempt late last year.

MAS guidelines on IT security require banks to conduct regular internal tests on their systems and networks, including security vulnerability assessments.

The regulator said in a statement on Tuesday: "This includes maintaining a high level of security for their critical IT systems, such as Swift."

Swift refers to the Society for Worldwide Interbank Financial Telecommunication - whose system is used by banks and firms to move money around the world through payment orders.

The cyber-attack attempts on Tien Phong Bank had involved fraudulent Swift messages.

So far, Singapore has not been targeted by such audacious cyber criminals but, as a financial hub serving as global and regional headquarters for many international banks, it might be only a matter of time before hackers set their sights here.

If that were to happen, it would be imperative for banks here to have the right level of IT controls to detect and stop the fraudulent activity.

Otherwise, the consequences could be disastrous, not just for the institution involved, but also for Singapore's reputation as a financial centre.

A version of this article appeared in the print edition of The Straits Times on May 19, 2016, with the headline 'IT security vital for financial hub'. Print Edition | Subscribe