Muscat: The swift advancement of digitalization within financial systems has introduced new challenges to the stability of the financial sector, as highlighted in the most recent report from the Congressional Budget Office (CBO) on Financial Stability Reports (FSRs).
"The escalation in cyber-attacks, especially those aimed at financial institutions globally, could lead to systemic repercussions if they diminish the trust users place in digital platforms. The CBO is acutely aware of these cyber threats and is actively developing policies to mitigate these risks and protect the integrity of the market," the report further elaborates.
Furthermore, climate change poses a significant and formidable threat, with its extensive impacts being increasingly observed worldwide.
The imperative of shifting towards an economy free of emissions is critical, given the looming physical shocks and the risks associated with the transition.
The CBO is taking a proactive stance, recommending that financial institutions enhance their risk management strategies by integrating climate risks and adopting initiatives in green financing.
