niklaus blattner : it in the financial sector - aspects of regulation and supervision summary of a speech by mr niklaus blattner, vice - chairman of the governing board of the swiss national bank, at 8. berner tagung fur informationssicherheit ( 8th conference on information security ), berne, 29 november 2005. the complete speech can be found in german on the swiss national bank ’ s website ( www. snb. ch ). * * * the completeness, integrity, traceability and constant availability of data that has been securely processed are essential in order for the financial system to function smoothly. the swiss federal banking commission ( sfbc ) supervises banks and securities dealers domiciled in switzerland. its microprudential supervision focuses on the individual financial institution, in particular with regard to the protection of creditors and investors. by contrast, it is the task of the swiss national bank ( snb ) to contribute to the stability of the financial system, i. e. it is engaged in macroprudential oversight. banking legislation provisions governing the it organisation requirements of a financial intermediary do not explicitly address the topic of information security, but rather focus on the notion of “ proper and rightful conduct of business ”. for the sfbc, information security is merely one concern among others. in one of its circulars it has, however, addressed several critical areas in greater detail, e. g. on the topic of external data management and outsourcing. the snb ’ s mandate is limited to the payment and securities settlement systems. in its oversight function, the snb focuses on systems which might constitute a potential threat to the stability of the swiss financial system. the snb ’ s objectives with regard to information security include the following : security policy and organisation, physical and staff security, system operation, system development and maintenance, communication and information exchange and – last but not least – business continuity management. similar to the sfbc, the snb basically pursues a dualistic approach, i. e. it relies primarily on the results of internal and external audits. any supplemental, cross - system measures must be jointly coordinated and synchronised by all the major players. the steering group “ business continuity planning ” ( bcp ), headed by the snb, assumes this function and examined the business continuity plans developed in the individual companies. the report reveals that a great deal of progress has been made with regard to the bc

increased to address such threats. in other words, at the current juncture, monetary policy cannot react to these imbalances with conventional monetary policy instruments. therefore, the swiss government is due to decide soon upon the introduction of so - called macroprudential instruments that can be used – if necessary – to mitigate potential credit and housing market distortions. conclusion the outlook for the global economy remains subdued. this, together with the persistently strong swiss franc, is weighing on economic activity in switzerland. although some indicators have pointed to a slight stabilization recently, we project that the swiss economy will grow only weakly over the next few quarters. the degree of uncertainty regarding the growth outlook remains unusually high, also by historical standards. downside risks – in particular stemming from a further escalation of the european debt crisis – are substantial. if these were to materialize, economic activity in switzerland would suffer a much more pronounced slowdown than just described. despite this rather gloomy overall picture, we should not overlook the potential for a more optimistic development. for instance, if the european authorities were to credibly commit to a sustainable solution soon, existing uncertainties would be reduced substantially. in such a scenario, demand for perceived safe financial assets would fall in general, and for the swiss franc in particular. however, as downside risks are currently far more likely to materialize, the snb will enforce the minimum exchange rate with the utmost determination. under these exceptional circumstances, it is a necessary measure to fulfill our mandate. bis central bankers ’ speeches