Core banking application is a solution that drives the operations of a banking institution. It is called the bank host, implying that it hosts the banking transactional and customer database. As the backbone software for the banking institution, the core banking application maintain a database of customers’ information, transactional records, credit/loan records, cash/credit balance, among others. It also supporting the operations of banking business by driving transaction processing, which are not limited to cash payment, check/cheque payment, credit/loan facilities, trade services (visible and invisible), electronic channels payment (ATM, POS, Web), utility bills, treasury and securities (treasury bills, bonds, open market operations, commercial loans), foreign exchange, etc.
The core banking application usually comes with modules such as Customer Relationship Management (CRM) solution, Asset and Liability management (ALM), financial statement management (consolidated balance sheet & profit/loss account statement), treasury solutions, Core/transaction module and loan book. Through Application Programmable Interface (API), the core banking application is usually integrated with other payment solutions, channel infrastructure and technologies aimed at processing payment transactions from various unrelated platforms and technologies such as mobile and internet banking solutions, ATM, POS and web payments, USSD and payment card infrastructures.
Given the multifaceted nature of the core banking application and the need for it to be robust enough to handle different forms of transactions and interoperate with different platforms and technologies, not being aware of the inherent risk/vulnerabilities associated with such diverse deployment of the application and the threat they pose to the financial institution could be dangerous. As such, it is important that the risk associated with the core banking application solution, its underlining infrastructure as well as supporting processes and operations are continually assessed to identified threats posed to the system, their impact on confidentiality, integrity and availability as well as countermeasures to mitigate such risk.
The risk associated with core banking application would vary with financial institutions and largely depends on how the solution and its underlining infrastructures were deployed. As such, it is important that personnel with security oversight responsibilities on the core banking application infrastructure put in context the organization’s uniqueness in terms of information security policies, procedures, security baselines, regulatory and legal requirements while conducting their security assessment or reviews of the solution to know how best to protect them. Business rules, banking products/services, regulatory requirements, local banking laws and global banking regulatory frameworks among others are some of the factors that affect the way core banking application is architected and deployed as such, assessment of risks should also be along those lines.
This book is therefore a documentation of risks (operational, process and technology) and vulnerabilities associated with the core banking application solution and infrastructure, threats and threat agents that could exploit those weaknesses, their impact on the financial institution of interest and actions required to mitigate such risks. It serves as a risk assessment checklist/guide for risk assurance practitioners (IT Risk Manager, Cyber/Information Security Analysts, Information Systems Auditors and Systems Control Analysts) and enable them understand as well as identify some of the risks inherent in the core banking solution, implications/impact of such risks/vulnerabilities and ways to mitigate them. The book is a risk assessment checklist/program guide for risk assurance practitioners and provides unique/rich database of vulnerabilities/risk, control lapses, process failures and substandard practices associated with Core Banking Application Solution and infrastructure. It can be applied for core banking applications such as Finacle, Flexcube, Banks, Globus, Equinox, Phoenix on general terms although there may be specifics for the different solutions.
Intended for financial institutions desirous of build a risk management program around their Core Banking Application Solution from the ground up or strengthen an existing one. Below are sample pages of the Core Banking Application risk assessment checklist/program. For full access to the document, you can subscribe to our membership plan for full access to all risk assessment checklists available on our site (this inclusive) or purchase only this book by clicking the Buy Now button below.