Systemic Cyber Risk in the Financial Sector: Can Network Analysis Assist in Identifying Vulnerabilities and Improving Resilience?

The increasing interconnectedness and digitalisation of the financial sector have exposed it to a new and pervasive threat: systemic cyber risk. Systemic cyber risk in finance refers to the potential for a cyber-attack or breach to cause widespread disruption and instability across financial systems and markets. This type of risk can arise from various sources, including hackers, insider threats, and technological failures. Financial institutions and policymakers can help safeguard the global economy and protect against potential disruptions and instability by addressing systemic cyber risk. To effectively mitigate systemic cyber risk, it is important to have a deep understanding of the potential threats and vulnerabilities within their systems. This requires ongoing analysis and study of the evolving nature of cyber threats and the latest technological advancements in cybersecurity. Ongoing analysis and study of cyber threats and advancements in cybersecurity are crucial to staying ahead of evolving risks and ensuring the financial system’s stability. In this context, Network analysis can be a valuable tool in studying systemic cyber risk in the finan- cial domain since it is a powerful tool for understanding the interconnectedness of financial institutions and markets and the potential pathways for cyber risk to spread throughout the system. By mapping out these networks and identifying key nodes and vulnerabilities, institutions can better prepare for and respond to cyber-attacks.