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Cyber ResilienceIn February 2022, the central bank of Kuwait (CBK) introduced a framework that defines guidelines to improve cyber resilience for banks in Kuwait. The Cybersecurity Framework For Kuwaiti Banking Sector is a framework that contains recommendations, guidelines, and procedures to building a cyber secure and resilient banking sector in Kuwait.
This framework emphasizes the importance of effective internal control mechanisms within banks. It enables banks to assess their cybersecurity risk profile and adopt adequate mitigating measures according to their risk exposure.
In February 2022, the central bank of Kuwait (CBK) introduced a framework that defines guidelines to improve cyber resilience for banks in Kuwait. The Cybersecurity Framework For Kuwaiti Banking Sector is a framework that contains recommendations, guidelines, and procedures to building a cyber secure and resilient banking sector in Kuwait.
This framework emphasizes the importance of effective internal control mechanisms within banks. It enables banks to assess their cybersecurity risk profile and adopt adequate mitigating measures according to their risk exposure.
The increasing adoption of various technologies including the list below necessitates a standard for security in the banking sector.
- Expansion of digital payment systems and fintech
- Increasing dependency on third-party services and technologies
- The need to maintain resilience as banking technology rapidly advances
- The need for improved security strategies with the increase in sophistication and frequency of cyberattacks.
- The need for compliance with global standards
All these and more probed the central bank of Kuwait, as the bank regulatory body, to develop a cybersecurity framework that ensure service continuity for its member institutions and competitiveness with global banking sectors. The cybersecurity framework for Kuwait’s banking sector is part of the country’s efforts to improve cybersecurity in the financial industry.
The central bank of Kuwait is the enforcement body, charged with monitoring the implementation and effectiveness of the framework through annual and semi-annual assessments and meetups with banks. The banking community has received the framework well and is considered an essential piece of cybersecurity infrastructure to help banks and the central bank strengthen their cyber resilience.
The increasing adoption of various technologies including the list below necessitates a standard for security in the banking sector.
- Expansion of digital payment systems and fintech
- Increasing dependency on third-party services and technologies
- The need to maintain resilience as banking technology rapidly advances
- The need for improved security strategies with the increase in sophistication and frequency of cyberattacks.
- The need for compliance with global standards
All these and more probed the central bank of Kuwait, as the bank regulatory body, to develop a cybersecurity framework that ensure service continuity for its member institutions and competitiveness with global banking sectors. The cybersecurity framework for Kuwait’s banking sector is part of the country’s efforts to improve cybersecurity in the financial industry.
The central bank of Kuwait is the enforcement body, charged with monitoring the implementation and effectiveness of the framework through annual and semi-annual assessments and meetups with banks. The banking community has received the framework well and is considered an essential piece of cybersecurity infrastructure to help banks and the central bank strengthen their cyber resilience.
The CBK Cybersecurity Framework Core Principles
The cybersecurity framework introduces a standardized methodology to identify cyber risks and develop frameworks to strengthen banks’ cyber resilience. The framework consists of 3 core components:
- Cybersecurity Governance
- Collaboration
- Continual Improvement
The CBK Cybersecurity Framework Core Principles
The cybersecurity framework introduces a standardized methodology to identify cyber risks and develop frameworks to strengthen banks’ cyber resilience. The framework consists of 3 core components:
- Cybersecurity Governance
- Collaboration
- Continual Improvement
Cybersecurity Governance
This principle of the CBK cybersecurity framework covers security guidelines for banks to establish a procedure across three domains:
Governance: A cybersecurity program is as good as the involvement of the relevant stakeholders. These domains help banking institutions build an effective governance model around their organizational structure. This will help in providing adequate support to create, implement, and manage an effective organization-wide cybersecurity program.
Risk Management: Adopting the latest technology does not come without its own risks. This domain aims to assist banking institutions in assessing, identifying, addressing, and managing their exposure and the risks associated with their technology usage.
Compliance: Various existing laws, regulations, and standards govern banking operations in Kuwait. This domain helps comply with the various local, national, and international regulations that govern the use of digital technology in banking.
Collaboration
Several digital banking activities rely on interaction and collaboration with external services and financial institutions. Therefore, banking institutions must pay adequate attention to the security of these interrelationships. The collaboration principle of the CBK cybersecurity framework recommends collaborative cybersecurity initiatives through the following domains:
Information Security Working Group: This is a unique domain to the CBK cybersecurity framework. The framework establishes an Information Security Working Group, a forum that fosters sectoral discussions on appropriate cybersecurity controls that are best suited for the Kuwait banking industry.
Sectoral Initiatives, Awareness and Training: Sensitization, awareness, and training are essential for an effective cybersecurity program. With the interdependent nature of the banking industry, it is crucial to organize periodic training and awareness on the latest cybersecurity developments, how threats are evolving, and how member institutions can safeguard their systems from intrusion.
Cyber Threat Intelligence Sharing: Given the intertwined relationship between banks, a threat to one is a potential threat to all. For this reason, it is crucial to establish a pipeline for seamless exchange of threat information across the banking sector. The cyber threat intelligence sharing domain ensures this.
Continual Improvement
Security is never a one-off thing. It requires continuous action, sensitization, adaptation, and improvement. The continual improvement principle ensures continuity in banking institution’s cybersecurity programs through the following domains:
Cybersecurity Baselines: To ensure improvement, banking institutions must set benchmarks and minimum requirements for their cybersecurity posture. The CBK cybersecurity framework provides security baselines per international standards and cybersecurity frameworks such as the National Institute of Standards and Technology (NIST), International Organization for Standardization (ISO), Information Security Forum (ISF), Payment Card Industry (PCI), Center for Internet Security (CIS).
Assessment & Maturity: The domains helps banking institution to continuously assess their current cyber risks and the existing structure to mitigate them. The framework provides assessment tools that assist in measuring and reporting these risks and assessments. The tools help to develop an inherent risk profile, perform baseline assessment, and report the evaluation—all of these on an ongoing basis.
Cyber Crisis Management & Plan: The rapid adaptability, increasing lethality, and volatile nature of cyber threats can eventually result in a compromise. In such cases, it is vital to have a plan in place, enabling them to restore disrupted services to normal as soon as possible. The cyber crisis management domain provides guidelines to help banking institutions develop an ongoing recovery strategy and incident management system.
Cybersecurity Governance
This principle of the CBK cybersecurity framework covers security guidelines for banks to establish a procedure across three domains:
Governance: A cybersecurity program is as good as the involvement of the relevant stakeholders. These domains help banking institutions build an effective governance model around their organizational structure. This will help in providing adequate support to create, implement, and manage an effective organization-wide cybersecurity program.
Risk Management: Adopting the latest technology does not come without its own risks. This domain aims to assist banking institutions in assessing, identifying, addressing, and managing their exposure and the risks associated with their technology usage.
Compliance: Various existing laws, regulations, and standards govern banking operations in Kuwait. This domain helps comply with the various local, national, and international regulations that govern the use of digital technology in banking.
Collaboration
Several digital banking activities rely on interaction and collaboration with external services and financial institutions. Therefore, banking institutions must pay adequate attention to the security of these interrelationships. The collaboration principle of the CBK cybersecurity framework recommends collaborative cybersecurity initiatives through the following domains:
Information Security Working Group: This is a unique domain to the CBK cybersecurity framework. The framework establishes an Information Security Working Group, a forum that fosters sectoral discussions on appropriate cybersecurity controls that are best suited for the Kuwait banking industry.
Sectoral Initiatives, Awareness and Training: Sensitization, awareness, and training are essential for an effective cybersecurity program. With the interdependent nature of the banking industry, it is crucial to organize periodic training and awareness on the latest cybersecurity developments, how threats are evolving, and how member institutions can safeguard their systems from intrusion.
Cyber Threat Intelligence Sharing: Given the intertwined relationship between banks, a threat to one is a potential threat to all. For this reason, it is crucial to establish a pipeline for seamless exchange of threat information across the banking sector. The cyber threat intelligence sharing domain ensures this.
Continual Improvement
Security is never a one-off thing. It requires continuous action, sensitization, adaptation, and improvement. The continual improvement principle ensures continuity in banking institution’s cybersecurity programs through the following domains:
Cybersecurity Baselines: To ensure improvement, banking institutions must set benchmarks and minimum requirements for their cybersecurity posture. The CBK cybersecurity framework provides security baselines per international standards and cybersecurity frameworks such as the National Institute of Standards and Technology (NIST), International Organization for Standardization (ISO), Information Security Forum (ISF), Payment Card Industry (PCI), Center for Internet Security (CIS).
Assessment & Maturity: The domains helps banking institution to continuously assess their current cyber risks and the existing structure to mitigate them. The framework provides assessment tools that assist in measuring and reporting these risks and assessments. The tools help to develop an inherent risk profile, perform baseline assessment, and report the evaluation—all of these on an ongoing basis.
Cyber Crisis Management & Plan: The rapid adaptability, increasing lethality, and volatile nature of cyber threats can eventually result in a compromise. In such cases, it is vital to have a plan in place, enabling them to restore disrupted services to normal as soon as possible. The cyber crisis management domain provides guidelines to help banking institutions develop an ongoing recovery strategy and incident management system.
Benefits of Compliance with the CBK Cybersecurity Framework
Generally, the framework focuses on the following four areas:
- Understanding banking strategies such as outsourcing (third-party), digitalization, and use of FinTechs
- Creating policies and procedures such as cyber crisis management, information technology security, access control management, communication, disaster recovery, compliance and audit
- Securing IT systems and networks, such as ATM network connectivity; and
- Establishing IT processes such as asset management and secure disposal.
Each of these areas helps banks develop an effective and inclusive cybersecurity program, which improves their general security posture. An improved and resilient banking cybersecurity posture means:
- Reduced service disruption
- Improved customer service
- Strong public trust
- Reduced risk of losing assets
- Safety of critical data.
Benefits of Compliance with the CBK Cybersecurity Framework
Generally, the framework focuses on the following four areas:
- Understanding banking strategies such as outsourcing (third-party), digitalization, and use of FinTechs
- Creating policies and procedures such as cyber crisis management, information technology security, access control management, communication, disaster recovery, compliance and audit
- Securing IT systems and networks, such as ATM network connectivity; and
- Establishing IT processes such as asset management and secure disposal.
Each of these areas helps banks develop an effective and inclusive cybersecurity program, which improves their general security posture. An improved and resilient banking cybersecurity posture means:
- Reduced service disruption
- Improved customer service
- Strong public trust
- Reduced risk of losing assets
- Safety of critical data.
Conclusion
Conclusion
Following similar steps by leading Middle East nations such as Saudi Arabia and the United Arab Emirates, the central bank of Kuwait introduced a cybersecurity framework in 2020. This framework is aimed at helping banking institutions in the country develop a modern, resilient cyber defense system, as well as improving internal security relationships between banking institutions in the country.
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