The future of the wealth management industry will be shaped by a range of disruptive themes, with cybersecurity being one of the themes that will have a significant impact on wealth management companies.
Cybersecurity is the practice of defending computers, servers, mobile devices, electronic systems, networks, and data from malicious attacks. Cybersecurity in banking has become more important than ever as the rapid evolution of digital banking has resulted in customers finding it more convenient to manage their finances through online channels, exposing banks and financial institutions to increased levels of cyber threats. The impact of cyberattacks on financial institutions can be catastrophic, so innovation will be needed to counter the continuously evolving cyberthreat landscape in the retail banking sector, which includes both channel shifts driven by the pandemic and fallout from the Ukraine-Russia conflict.
However, not all companies are equal when it comes to their capabilities and investments in the key themes that matter most to their industry. Understanding how companies are positioned and ranked in the most important themes can be a key leading indicator of their future earnings potential and relative competitive position.
According to GlobalData’s thematic research report, Cybersecurity in Banking, leading adopters include: UBS, RBC, DBS, HSBC, T Rowe Price, Bank of America, Charles Schwab, Goldman Sachs, Wells Fargo, and OCBC.
Insights from top ranked companies
In 2012, HSBC failed to notice that Mexican drug cartels were laundering money through the bank. As part of a subsequent settlement with US regulatory authorities, HSBC was forced to invest millions of dollars into compliance and better security solutions. The bank has made significant investments to improve resilience and cybersecurity capabilities, thus enhancing its ability to detect, deter, and prevent cybercrimes. One of the tools developed uses data to look for unusual ties between its customers and companies to avoid further compliance failures. Using biometrics technology, HSBC has streamlined the login process through Apple’s Touch ID and HSBC Voice ID across its 18 markets, enhancing security. In 2017, HSBC Ventures invested $40m in Menlo Security—a cybersecurity company that helps businesses detect and respond to threats—to add Menlo’s capabilities and safeguard its own business from cyber threats. In 2021, it was announced that HSBC had selected Mailock, Beyond Encryption’s email security system, to assist HSBC in building enhanced digital relationships with their customers.
Goldman Sachs has a team of experts and engineers who monitor and respond to cybersecurity threats, managing the entire process. The firm’s range of cybersecurity experts includes engineers charged with implementing solutions with security by design; threat analysts who analyse, detect, and respond to cybersecurity threats; and pen testers who identify vulnerabilities before attackers can exploit them. In 2019, Goldman also led an $8m investment into Immersive Labs’ cybersecurity skills platform. This uses real-time feeds of the latest attack techniques, hacker psychology, and technological vulnerabilities to rapidly build cyber wargames to train IT and security teams.
To further understand the key themes and technologies disrupting the wealth management industry, access GlobalData’s latest thematic research report on Cybersecurity in Banking.
- Scalable Capital
- Empower Retirement
- JPMorgan Chase
- Magnum Research
- Societe Generale
- Morgan Stanley
- BNY Mellon
- St. James's Place
- Lombard Odier
- Bank of Montreal
- Santander Group
- ABN AMRO
- Raymond James
- Julius Baer