De Nederlandsche Bank (DNB) has published “Resilience in turbulent times”, a study on how geopolitical risks could affect banks, insurers and pension funds and what this may mean for supervisory priorities. The study finds that geopolitical tensions can act as a trigger for both financial risk and non-financial risk, with cross-border vulnerabilities making European cooperation and stronger cyber resilience key themes. The analysis highlights financial transmission channels such as credit losses and stock market shocks, and non-financial exposures arising from an increasingly complex digital operating environment where cyberattacks are a particularly notable threat. It calls for institutions to incorporate geopolitical risks into risk management using tools such as stress tests and scenario analyses, and to assess vulnerabilities across critical third-party dependencies including ICT providers, given that disruptions can propagate through interconnected chains. The release also references the disruptive impact of the CrowdStrike-related outage as an illustration of digital fragility and points to the European Digital Operational Resilience Act as a legislative response to strengthen resilience, while noting that DNB applies comparable cyber standards internally, including testing its own IT systems.
De Nederlandsche Bank 2025-03-31
De Nederlandsche Bank publishes study warning geopolitical tensions can trigger financial shocks and cyber risk for financial institutions
De Nederlandsche Bank's study, "Resilience in Turbulent Times," examines geopolitical risks' impact on banks, insurers, and pension funds, stressing European cooperation and stronger cyber resilience. It highlights incorporating geopolitical risks into risk management via stress tests and scenario analyses, assessing vulnerabilities in critical third-party dependencies, and references the European Digital Operational Resilience Act to enhance resilience.