Over the last several years, cyber security, a crucial component in any operation, has taken on an increasingly visible role due to numerous high-profile data breaches impacting various industries. As malware becomes more complex and hackers make use of AI, servicers could face significant challenges staying one step ahead of malicious actors. Servicers' inaction or missteps could have financial, regulatory, and customer-related consequences.

The success of any cyber security programme will be dictated by the organisation's ability to implement and maintain a high level of protection.

"During S&P Global Ratings' servicer evaluation review process, we ask the company to describe its overall cyber security programme and focus on many related topics," says Steven Frie.

S&P Global has published details on how it assesses these cyber security programmes in a new Servicer Evaluation Spotlight Report entitled, "The Importance Of Cyber Security For U.S. And Canadian Servicers In A Challenging Environment”.

The report says that "according to the cyber security research firm Check Point Research, the average number of cyber attacks per organisation per week rose 38% in 2022 from 2021, and increased 28% in the six-month period ending March 31, 2024. The average number of weekly events has also grown year over year."

"We believe sustained investments in cyber security will be crucial for any business entity, especially servicers, as they will continue to experience ever-evolving threats requiring additional expertise, capital, and technology to stay ahead of the curve. Despite servicers' significant expenditure on cyber security staff and systems to support their programmes, these preventative measures are only effective if the programme is successfully implemented and maintained," he continues.

“Servicers' inaction or missteps could have financial, regulatory, and customer-related consequences. The success of any cyber security programme will be dictated by the organisation's ability to implement and maintain a high level of protection,” concludes Frie.