Executive Briefings

Now, Your Creditworthiness Depends in Part on Your Cybersecurity Measures

Cyberattacks are growing in number and scope due to rapid increases in interconnectivity and mobile data. In response, Moody's Investors Service announced that the credit implications associated with cyber defense, detection, prevention and response should start to take a higher priority within its credit assessments and analysis.

Now, Your Creditworthiness Depends in Part on Your Cybersecurity Measures

"While we do not explicitly incorporate cyber risk as a principal credit factor today, our fundamental credit analysis incorporates numerous stress-testing scenarios, and a cyber event could be the trigger for one of those scenarios," said Jim Hempstead, Moody’s associate managing director. "As cyber risk becomes more pervasive, it will take a higher priority within our analysis."

Though not a principal credit factor in assessing a rating, Moody's now treats cyber threat as an event risk. "Event risks" are extraordinary events that fall into the stress-testing scenarios Moody's uses for its fundamental credit analyses.

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"While we do not explicitly incorporate cyber risk as a principal credit factor today, our fundamental credit analysis incorporates numerous stress-testing scenarios, and a cyber event could be the trigger for one of those scenarios," said Jim Hempstead, Moody’s associate managing director. "As cyber risk becomes more pervasive, it will take a higher priority within our analysis."

Though not a principal credit factor in assessing a rating, Moody's now treats cyber threat as an event risk. "Event risks" are extraordinary events that fall into the stress-testing scenarios Moody's uses for its fundamental credit analyses.

Read Full Article

Now, Your Creditworthiness Depends in Part on Your Cybersecurity Measures