[OR] [BDO] [E3] [CBS] [1] [SuPS] Identify Severe but Plausible Scenarios

CBS-1 Retail Deposit & Account Services

Introduction

In alignment with the Bangko Sentral ng Pilipinas (BSP) Circular No. 1203, Series of 2024, on Operational Resilience, financial institutions such as BDO Unibank are required to identify Severe but Plausible Scenarios (SbPS) that could disrupt their Critical Business Services (CBS).

These scenarios are not extreme outliers but credible events that have a realistic likelihood of occurring, based on historical incidents, emerging risks, and evolving threat landscapes (including cyber and ICT risks).

For CBS-1 Retail Deposit & Account Services, identifying such scenarios enables BDO Unibank to test its resilience, validate impact tolerances, and ensure the continuity of essential banking services for customers.

The scenarios below incorporate regulatory expectations, including cyber resilience, third-party risk, operational risk, and ICT dependency management, as required by BSP.

Table P5: Identify Severe but Plausible Scenarios for CBS-1

Sub-CBS Code	Sub-CBS	Severe but Plausible Scenario	Impact / Effect	Proactive Risk Management Action	Link to Integration of Cyber and ICT Risks
1.1	Customer Onboarding & Account Opening	Digital onboarding platform outage due to cloud service disruption	Inability to onboard new customers; revenue loss; reputational impact	Multi-channel onboarding fallback (branch/manual); cloud redundancy; onboarding SLA monitoring	Cloud outage, API failure, digital channel dependency
1.2	Customer Identity Verification & Compliance Screening	Failure of the KYC/AML screening system due to vendor system downtime	Regulatory breach risk; onboarding delays; compliance exposure	Secondary screening tools, offline verification procedures, and vendor SLA enforcement	Third-party RegTech failure; data validation system disruption
1.3	Account Setup & Product Configuration	Core banking configuration error during system upgrade	Incorrect account setup; customer dissatisfaction; operational rework	Change management controls; pre-deployment testing; rollback procedures	Core banking system change risk; configuration integrity failure
1.4	Initial Funding & Deposit Acceptance	Branch system outage during the peak deposit period	Transaction delays, customer dissatisfaction, liquidity processing delays	Branch offline processing procedures, queue management, and alternate channels	Branch system downtime; network connectivity disruption
1.5	Cash Withdrawal & Funds Access	ATM network outage due to telecom failure	Customers unable to withdraw funds; reputational damage	ATM network redundancy; multi-provider telecom setup; cash contingency plans	ATM switch failure; telecom dependency risk
1.6	Account Maintenance & Customer Information Update	Data corruption incident affecting customer records	Incorrect customer information; service disruption; regulatory breach	Data backup and recovery; audit trails; data validation controls	Data integrity failure; database compromise
1.7	Credential Fulfilment (Cards, Cheques)	Card production vendor disruption due to a cyberattack	Delay in card issuance; customer onboarding impact	Multi-vendor strategy; inventory buffer; vendor risk assessments	Third-party cyberattack; supply chain disruption
1.8	Digital Banking Access Management	Mass account lockout due to authentication system failure	Customers unable to access accounts; service complaints spike	Identity and access redundancy; failover authentication; customer support surge plan	IAM system failure; authentication service outage
1.9	Balance Inquiry & Statements	Mobile banking app outage due to an application bug	Customers unable to view account balances; increased call centre load	App monitoring; rollback capability; alternative channels (ATM/branch)	Application failure; digital channel instability
1.10	Account Transfers	Payment gateway failure is impacting interbank transfers	Delayed transfers, liquidity issues, and customer dissatisfaction	Alternate clearing routes, payment rerouting, and reconciliation controls	Payment system outage; API/network disruption
1.11	Bills Payment & Scheduled Debits	Failure in the scheduled batch processing system	Missed payments, penalties, and customer complaints	Batch job monitoring; retry mechanisms; customer notification protocols	Batch processing failure; scheduling system error
1.12	Transaction Posting & Ledger Update	Core ledger posting delay due to system overload	Inaccurate balances; financial reporting delays	System capacity scaling; performance monitoring; transaction queue management	Core system overload; processing latency risk
1.13	Interest, Fees & Charges Processing	Incorrect interest computation due to a system defect	Financial loss; regulatory breach; customer disputes	Automated validation checks; reconciliation controls; periodic audits	Calculation engine failure; system logic error
1.14	Exception Handling & Dispute Resolution	Surge in transaction disputes due to a system error	Operational backlog; customer dissatisfaction	Case management automation; surge staffing; root cause analysis	Fraud/dispute system overload; data inconsistency
1.15	Fraud Monitoring & Protective Controls	Fraud detection system failure during a cyberattack	Increased fraud losses; regulatory penalties	AI-based fraud monitoring backup; real-time alerts; SOC escalation	Cyber intrusion; fraud detection system compromise
1.16	Reconciliation & Financial Reporting	Reconciliation system failure due to data mismatch	Financial misstatements; audit issues	Automated reconciliation tools; manual fallback; exception reporting	Data inconsistency; system integration failure
1.17	Regulatory Reporting & Compliance	Failure to submit regulatory reports due to a system outage	Regulatory penalties; compliance breach	Backup reporting processes; manual submission capability	Reporting system failure; regulatory interface disruption
1.18	Service Continuity & Incident Response	Data centre outage due to a natural disaster	Full service disruption; prolonged downtime	DR site activation; crisis management protocols; regular DR testing	Data centre failure; infrastructure resilience risk
1.19	Dormancy, Freeze & Closure Management	Erroneous account freezing due to a system glitch	Customer dissatisfaction; legal exposure	Control validations; override mechanisms; audit trails	System rule error; account control failure
1.20	Third-Party & Infrastructure Dependency	Critical vendor (cloud/core banking) outage	Widespread service disruption across CBS	Vendor redundancy; exit strategies; resilience testing	Third-party concentration risk; systemic ICT failure

Banner [Summing] [OR] [E3] Identify Severe but Plausible Scenarios

The identification of Severe but Plausible Scenarios for CBS-1 Retail Deposit & Account Services enables BDO Unibank to transition from a reactive business continuity posture to a proactive operational resilience approach.

By systematically analysing disruptions across people, processes, technology, and third-party dependencies, the bank can better understand vulnerabilities and strengthen its ability to remain within defined impact tolerances.

In compliance with BSP Circular No. 1203, these scenarios must be regularly tested through scenario testing and simulation exercises to ensure that resilience strategies are effective under real-world conditions.

Importantly, the integration of cyber and ICT risks across all scenarios reflects the modern threat landscape, where digital disruptions are increasingly the primary drivers of operational failures.

This structured approach ensures that BDO Unibank can sustain critical services, protect customers, and maintain trust even during significant disruptions.

Building Operational Resilience: A Case Study of BDO Unibank
eBook 3: Starting Your OR Implementation
CBS-1 Deposit & Account Services
CBS-1 DP	CBS-1 MD	CBS-1 MPR	CBS-1 ITo	CBS-1 SuPS	CBS-1 ST

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