Cybersecurity Tips for Small and Mid-Sized Banks

Small and mid-sized banks face all the cybersecurity risks of their large-bank counterparts without the same level of resources to confront them. A single cyber incident can jeopardize operations, damage reputations, and erode customer trust. However, as explained in a recent RMA Journal article, smaller banks have practical and cost-effective options to manage these risks. Here are some strategies to strengthen your bank’s defenses: 

Map your “IT estate.” Understanding your IT infrastructure is critical. Banks can use low-cost governance tools to create a detailed map of their systems, including third-party vendors. This helps identify vulnerabilities and allocate resources effectively. Christopher Neumann, chief information security officer at Covetrus, recommends deploying attack surface management software to monitor for risks and emphasized the importance of thinking like an attacker to anticipate entry points. 

Practice incident response. Preparation is key to successfully managing cyber incidents. Develop a comprehensive incident response plan outlining roles, responsibilities, and escalation procedures. Simulated exercises like tabletop drills and “purple team” scenarios—where attackers (red team) and defenders (blue team) test their readiness—can expose gaps in procedures. Banks should establish continuity plans, including reliable backups to recover from ransomware attacks, and retain outside legal counsel to assist in incident response. 

Focus resources strategically. With limited budgets, smaller banks must prioritize. Conduct a business impact analysis to identify mission-critical functions and allocate resources where risks could have the greatest financial or operational impact. The National Institute of Standards and Technology (NIST) offers tools like its cybersecurity framework to guide resource allocation effectively. 

Collaborate with experts. Building relationships with external experts can amplify response efforts. Engage with state agencies, the FBI, and Homeland Security for guidance and tips. Networking with other banks’ chief information security officers and considering board members with cybersecurity expertise can further strengthen defenses. 

Even with fewer resources, small and mid-sized banks can take meaningful steps to mitigate cyber risks. Learn more about these strategies in the full article on our website.