Featured Product

    FFIEC Issues Statement on Risk Management for Cloud Computing Services

    April 30, 2020

    FFIEC, on behalf of its members, issued a statement to address the use of cloud computing services and security risk management principles in the financial services sector. The statement highlights examples of risk management practices for a financial institution’s safe and sound use of cloud computing services and safeguards to protect the sensitive information of consumers. The statement also provides a list of government and industry resources and references to assist financial institutions using cloud computing services.

    The statement does not contain new regulatory expectations, though it highlights that management should not assume that effective security and resilience controls exist simply because the technology systems are operating in a cloud computing environment. The statement identifies the responsibilities financial institutions would have when contracting with cloud computing providers. Examples of relevant risk management practices for assessing risks related to and implementing controls for cloud computing services include the following:

    • The financial institution’s plans for the use of cloud computing services should align with its overall IT strategy, architecture, and risk appetite. This includes determining the appropriate level of governance, the types of systems and information assets considered for cloud computing environments, the impact on the financial institution’s architecture and operations model, and management’s comfort with its dependence on and its ability to monitor the cloud service provider.
    • Appropriate due diligence and ongoing oversight and monitoring of cloud service providers’ security is required. As with all other third-party relationships, security-related risks should be identified during planning, due diligence, and the selection of the cloud service provider.
    • Contracts between a financial institution and cloud service provider should be drafted to clearly define which party has responsibilities for configuration and management of system access rights, configuration capabilities, and deployment of services and information assets to a cloud computing environment, among other things.
    • An effective inventory process for the use of cloud computing environments is an essential component for secure configuration management, vulnerability management, and monitoring of controls.
    • Common practices for identity and access management for resources using cloud computing infrastructures include limiting account privileges, implementing multi-factor authentication, frequently updating and reviewing account access, monitoring activity, and requiring privileged users to have separate usernames and passwords for each segment of the cloud service provider’s and financial institution’s networks.
    • Operations moved to cloud computing environments should have resilience and recovery capabilities commensurate with the risk of the service or operation for the financial institution. Management should review and assess the resilience capabilities and service options available from the cloud service provider. 

    The risk management considerations outlined in the statement provide a summary of key controls that management may consider as part of assessing and implementing cloud computing services. However, specific risk management and controls will be dependent on the nature of the outsourced services and the specifics of the cloud implementation. Additional information on general third-party risk management and outsourcing practices is available in the FFIEC Information Technology Examination Handbook’s “Outsourcing Technology Services” booklet and other documents published by the FFIEC members.

     

    Related Links

    Keywords: Americas, US, Banking, Cloud Computing, Risk Management, Governance, Cyber Risk, FFIEC

    Related Articles
    News

    EBA Publishes Phase 2 of Technical Package on Reporting Framework 2.10

    EBA published phase 2 of the technical package on the reporting framework 2.10, providing the technical tools and specifications for implementation of EBA reporting requirements.

    July 10, 2020 WebPage Regulatory News
    News

    FASB Proposes to Delay Implementation of Insurance Contracts Standard

    FASB issued a proposed Accounting Standards Update that would grant insurance companies, adversely affected by the COVID-19 pandemic, an additional year to implement the Accounting Standards Update No. 2018-12 on targeted improvements to accounting for long-duration insurance contracts, or LDTI (Topic 944).

    July 09, 2020 WebPage Regulatory News
    News

    APRA Updates Regulatory Approach to Loan Deferrals Amid COVID Crisis

    APRA updated the regulatory approach for loans subject to repayment deferrals amid the COVID-19 crisis.

    July 09, 2020 WebPage Regulatory News
    News

    BCBS and FSB Set Out Recommendations for Benchmark Transition

    BCBS and FSB published a report on supervisory issues associated with benchmark transition.

    July 09, 2020 WebPage Regulatory News
    News

    IAIS Sets Out Recommendations for Benchmark Transition for Insurers

    IAIS published a report on supervisory issues associated with benchmark transition from an insurance perspective.

    July 09, 2020 WebPage Regulatory News
    News

    ESMA Updates Reporting Manual on European Single Electronic Format

    ESMA updated the reporting manual on the European Single Electronic Format (ESEF).

    July 09, 2020 WebPage Regulatory News
    News

    EBA Calls on Resolution Authorities to Consider Impact of COVID Crisis

    EBA published a statement on resolution planning in light of the COVID-19 pandemic.

    July 09, 2020 WebPage Regulatory News
    News

    BCBS Finalizes Revisions to Credit Valuation Adjustment Risk Framework

    BCBS Finalizes Revisions to Credit Valuation Adjustment Risk Framework

    July 08, 2020 WebPage Regulatory News
    News

    ECB Guideline on Materiality Threshold for Credit Obligations Past Due

    ECB published a guideline (2020/97), in the Official Journal of European Union, on the definition of materiality threshold for credit obligations past due for less significant institutions.

    July 08, 2020 WebPage Regulatory News
    News

    FED Temporarily Revises FR Y-14 With Respect to PPP and CARES Act

    FED temporarily revised the capital assessments and stress testing reports (FR Y-14A/Q/M) to implement the changes in response to the COVID-19 pandemic.

    July 08, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5458