[OR] [MBT] [E3] [CBS] [6] [SuPS] Identify Severe but Plausible Scenarios

Sub-CBS Code

Sub-CBS

Impact/Effect

Severe but Plausible Scenario

Proactive Risk Management Action

Link to Integration of Cyber and ICT Risks

6.1

Liquidity and Cash Management

Funding disruption, liquidity squeeze, delayed settlements

Sudden systemic liquidity crisis triggered by market volatility and mass withdrawals

Establish stress-tested contingency funding plans, enhance intraday liquidity monitoring, and diversify funding sources

Real-time liquidity dashboards with cyber-resilient infrastructure and DDoS-resistant connectivity to payment networks

6.2

Money Market Operations

Inability to rollover short-term funding, counterparty settlement delays

Failure of major counterparties during a sharp market downturn

Counterparty exposure monitoring, collateral stress testing, and diversifying counterparty mix

Secure automated exposure reporting and firmwide cyber-protection around interbank messaging

6.3

Foreign Exchange (FX) Trading and Settlement

Market loss, FX settlement failure (Herstatt risk)

Disruption in global FX clearing systems due to a geopolitical or cyber incident

Pre-funding arrangements, multi-venue settlement capability, and CLS participation

Cyber-secure FX trading interfaces and multilayer authentication for global clearing access

6.4

Fixed Income and Securities Trading

Price dislocation, failed trades, market liquidity freeze

Sovereign bond market freeze due to a rating downgrade or an economic shock

Liquidity buffers, diversified investment holdings, and market circuit-breaker monitoring

Secure, redundant pricing feeds and resilient connectivity to trading venues

6.5

Derivatives Trading and Risk Management

Hedging ineffectiveness, margin call stress

Rapid spikes in volatility trigger extraordinary margin calls

Margin stress simulations, collateral optimisation tools, counterparty credit limit controls

Cyber-secure risk analytics platforms and automated anomaly alerts for trading systems

6.6

Treasury Operations and Back-Office Support

Processing delays, failed confirmations

Operational outage causing settlement backlog across Treasury instruments

Manual fallback workflows, dual-site settlement operations, enhanced workforce cross-training

Backup systems, secure remote access, and ransomware-proof reconciliation processes

6.7

Collateral and Margin Management

Collateral shortfalls, regulatory breach

A major exchange outage is preventing margin transfers

Pre-approved alternative collateral channels, collateral pooling, and regulatory liaison protocols

Secure collateral management system integration with redundancy and monitored API connections

6.8

Treasury Risk Monitoring and Compliance

Missed limit breaches, non-compliance fines

Prolonged disruption to trading surveillance and risk reporting systems

Manual limit monitoring, pre-defined escalation triggers, enhanced scenario-based training

Cyber-hardened surveillance platforms and real-time monitoring of system integrity

6.9

Investment Portfolio Management

Portfolio value erosion, forced liquidations

Flash crash affecting fixed-income and FX markets simultaneously

Dynamic asset-allocation models, stress testing, liquidity overlay strategies

ICT-resilient portfolio systems with ISO-aligned cyber-security controls

6.10

Market Data and Pricing Support

Incorrect valuations, trade mispricing

Critical pricing vendor outage or corrupted data feed

Secondary data providers, internal pricing engines, robust vendor SLA governance

Resilient market-data gateways, automated cyber-threat scanning for data poisoning