The Bank of England released its biannual Systemic Risk Survey for the first half of 2024 on Wednesday, highlighting the evolving risk landscape faced by the UK financial system. Here are the key takeaways for GRC professionals:
- Confidence in the UK financial system’s stability remains steady, with 94% of respondents expressing some level of confidence over the next three years.
- The perceived probability of high-impact events affecting the UK financial system has decreased in both the short term (0-12 months) and medium term (1-3 years).
- Geopolitical risk and cyber attacks are the top concerns for financial institutions, with 85% and 70% of respondents citing these factors in their top five risks, respectively.
- Geopolitical risk reached its highest level of concern in the survey’s history, emphasizing the need for robust risk management strategies and increased collaboration between financial institutions and regulatory bodies.
- Inflation risk concerns have subsided, with only 41% of respondents including it in their top five risks, compared to 57% in the previous survey.
- The share of respondents citing AI-related risks doubled to 14%, highlighting the importance of considering the potential risks and ethical implications of AI adoption in the financial sector.
- Household and corporate credit risk concerns rose, with 20% of respondents including it in their top five risks, up from 7% in the previous survey.
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