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Bank of England, London
Bank of England warns that banks are overly reliant on cloud
Fin Strathern is an editor at TechForge Media. You can connect with him at https://www.linkedin.com/in/finstrathern/.

The Bank of England is calling for increased powers to oversee the banking and finance sector’s switch to cloud computing.

Its concerns stem from cloud adoption making systems more secretive and concentrating sensitive data in the hands of a select few tech giants like Amazon and Microsoft.

The central bank has said it will need “additional policy measures” to make sure it can assess the industry’s IT infrastructure, even when it’s run by third parties.

“Frankly, we’ll have to roll some of that back, that secrecy that goes with it. It’s not consistent with our objectives,” Governor Andrew Bailey told reporters.

The warning follows Deutsche Bank AG moving its most sensitive IT systems into Google’s Cloud. For firms like this, the cloud allows them to spend less on their own data centres while relying on the security and computing power of tech firms. The largest providers include Amazon Web Services, Microsoft Azure and Alphabet Inc.’s Google Cloud.

Sam Woods, chief executive officer of the Prudential Regulation Authority, said: “What we now have moving are things that are much more integral to the running of banks and those core systems, which could go to safety and soundness.”

The Bank of England said it is working with the U.K. Treasury and the Financial Conduct Authority on how to tackle these risks. Regulators around the world are weighing how to police the systemic risks across finance and technology.

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Want to learn more about topics like this from senior executives in this space? Learn more at the Cloud in FinTech & Banking Summit, on October 13 2021, on how financial organisations are using cloud migration for competitive advantage.

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Emma Crabtree

Emma Crabtree

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