Cyber and operational risks currently constitute one of the greatest threats to financial stability. This is the conclusion of DNB in its semi-annual Financial Stability Report.
The combination of geopolitical tensions and rapid technological development is increasing the necessity of digital resilience. Powerful generative AI models are causing cyber threats to emerge rapidly and to grow in scale, speed and complexity.
DNB president Olaf Sleijpen speaks of ‘code orange’ for the Dutch financial sector. Nevertheless, a stress test shows that Dutch banks are well positioned to absorb potential losses from an escalation of the conflict in the Middle East. The average core capital ratio falls by approximately 2 per centage points but remains at 15.7 per cent — well above requirements.
In addition to cyber risks, DNB flags two other areas of concern. The exposures of major Dutch insurers to the fast-growing private credit market increased by one third over the past four years to over 16 billion euros, while the stablecoin market doubled over two years to approximately 300 billion dollars. Both developments, according to DNB, require sharper oversight.
