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

CBS-1 Retail Deposit & Account Services

Introduction

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

Identifying Severe but Plausible Scenarios (SBPS) is a core requirement in operational resilience, focusing on events that are extreme enough to test the organisation’s ability to remain within its defined impact tolerances, yet realistic enough to occur.

According to BCM Institute, these scenarios should challenge critical business services across multiple dimensions—people, process, technology, and third-party dependencies—and be used as the basis for scenario testing and resilience improvement.

For The Philippine Bank of Communications (PBCom), this aligns with the expectations of Bangko Sentral ng Pilipinas under BSP Circular No. 1203 Series of 2024, which requires banks to identify severe but plausible scenarios such as natural disasters (e.g., earthquake/typhoon), cyberattacks, third-party failures, and payment system disruptions, and to assess whether critical services can continue within tolerance.

The table below provides a structured set of recommended scenarios for each Sub-CBS of CBS-1 Deposit and Account Services, including cyber/ICT linkages and proactive risk management actions.

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 and Account Application	A major typhoon causes branch closures and staff unavailability	Inability to onboard customers physically; backlog buildup	Enable digital onboarding, remote processing, alternate branch routing	Dependence on digital onboarding platforms and network availability
1.2	Customer Identification and Verification (KYC/CDD)	Cyberattack disables KYC screening systems	Inability to verify customers; onboarding halted	Maintain offline verification procedures and alternate screening provider	Critical reliance on AML/KYC systems and data integrity controls
1.3	Account Approval and Opening	System outage in the core banking approval workflow	Delayed or failed account activation	Manual approval fallback and queue prioritisation	Core banking availability and workflow system resilience
1.4	Initial Funding and Deposit Booking	Payment clearing network disruption	Deposits not credited or delayed	Use suspense accounts and deferred posting controls	Dependency on external payment/clearing infrastructure
1.5	Product Setup and Account Parameter Maintenance	Erroneous system configuration due to failed change deployment	Incorrect fees, interest, or account rules applied	Strengthen change control, rollback procedures, and validation testing	System configuration management and access control vulnerabilities
1.6	Deposit Transactions Processing	Core banking system failure or ransomware attack	All deposit transactions halted; severe customer impact	Activate DR site, transaction queuing and replay capability	High dependency on core banking, database, and cybersecurity controls
1.7	Withdrawal and Funds Access Processing	ATM network outage or cash shortage due to logistics disruption	Customers are unable to access funds	Provide branch cash alternatives and emergency withdrawal protocols	ATM switch, telecom, and cash logistics ICT dependencies
1.8	Account Servicing and Customer Maintenance	CRM system outage due to infrastructure failure	Inability to update customer records or process service requests	Enable manual servicing forms and delayed batch updates	CRM system resilience and data synchronisation risks
1.9	Interest, Fees, and Charges Processing	Batch processing failure during the end-of-day cycle	Incorrect or delayed interest/fees application	Re-run batch jobs, reconciliation checks, and the adjustment process	Batch scheduling system and database integrity risks
1.10	Statement, Passbook, and Balance Reporting	Data warehouse or reporting system outage	Customers are unable to access statements or balances	Provide alternative inquiry channels and regenerate reports post-recovery	Reporting system, database, and storage infrastructure dependencies
1.11	Digital Account Access Enablement	Telecom outage affecting OTP delivery and authentication	Customers are unable to log in or transact digitally	Provide alternate authentication methods and fallback channels	Dependency on telecom, IAM, and authentication systems
1.12	ATM and Card-Based Access Management	Third-party card network failure or cyber breach	Card transactions declined; widespread service disruption	Switch to alternate networks and enable rapid card controls	External card network and payment switch vulnerabilities
1.13	Account Reconciliation and Exception Handling	Failure in the reconciliation system or delayed data feeds	Unresolved breaks leading to inaccurate balances	Manual reconciliation procedures and prioritised exception clearing	Data feed integrity and reconciliation system dependencies
1.14	Dormancy, Holds, and Account Restrictions Management	Unauthorised system access leading to incorrect account restrictions	Customers wrongly blocked or allowed access	Strengthen access controls, audit trails, and dual authorisation	Cybersecurity risks related to privileged access management
1.15	Fraud Monitoring and Transaction Surveillance	Sophisticated cyber fraud attack bypassing detection rules	Financial loss and customer harm	Enhance real-time monitoring, AI detection, and rapid response	Integration with fraud analytics, cybersecurity monitoring systems
1.16	Complaints, Disputes, and Service Recovery	Surge in complaints during system outage overwhelming the call centre	Delayed response and reputational damage	Activate surge capacity, crisis communication, and prioritisation	Dependence on CRM, call centre systems, and digital channels
1.17	Regulatory Reporting and Compliance Monitoring	Data corruption affecting regulatory reporting submissions	Incorrect or delayed regulatory reporting	Implement data validation, backup reporting templates, and escalation protocols	Data integrity and reporting system vulnerabilities
1.18	Business Continuity and Service Recovery	Large-scale cyberattack combined with natural disaster (“compound event”)	Prolonged service disruption across all Sub-CBS	Activate crisis management, DR site, and cross-functional recovery	Full integration of ICT resilience, DR infrastructure, and cyber response

Regulatory Requirements and Examples (BSP Circular 1203)

Under BSP Circular No. 1203 Series of 2024, banks must:

Identify severe but plausible scenarios that could disrupt critical operations
Include a range of scenarios such as:

Natural disasters (e.g., earthquake, typhoon)
Cyberattacks and ransomware incidents
Failure of critical third-party service providers
Disruptions in payment and settlement systems

Use these scenarios to test whether operations remain within impact tolerance
Integrate cyber and ICT risks into operational resilience planning
Ensure board oversight and periodic review of scenario testing outcomes

For CBS-1 Deposit and Account Services, BSP examples such as a “Big One” earthquake, telecom failure, or coordinated cyberattack across banks are particularly relevant, as they directly impact customer access to deposits, transaction processing, and financial system stability.

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

The identification of Severe but Plausible Scenarios for CBS-1 Deposit and Account Services provides PBCom with a structured way to stress-test its most critical customer-facing services.

By mapping each Sub-CBS to realistic disruption scenarios, the bank can better understand how failures in technology, third-party providers, or operational processes could cascade across the service lifecycle.

In line with Bangko Sentral ng Pilipinas expectations, these scenarios must not remain theoretical—they should be actively used in scenario testing, simulation exercises, and continuous improvement programs.

The integration of cyber and ICT risks into each scenario ensures that PBCom is prepared not only for traditional disruptions but also for increasingly complex digital threats.

Ultimately, this strengthens the bank’s ability to maintain service continuity, protect customers, and operate within defined impact tolerances even under extreme conditions.

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CBS-1 Deposit & Account Services
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