CBN Warns One Bank’s Cyberattack Could Trigger Wider Financial System Crisis

The Central Bank of Nigeria, CBN, has warned that a cybersecurity breach at one financial institution could spread through interconnected banks, fintechs and technology providers, potentially disrupting Nigeria’s wider financial system.

The apex bank therefore urged financial institutions to treat cybersecurity, third-party technology risks and business continuity as issues of financial stability rather than concerns limited to individual organisations.

The warning was delivered on Wednesday by the Director of the CBN’s Payments System Supervision Department and Chairperson of the Nigeria Electronic Fraud Forum, Dr Rakiya Opemi Yusuf, during a panel session at the 19th Annual Banking and Finance Conference of the Chartered Institute of Bankers of Nigeria in Abuja.

The session, titled “Navigating Cyber and Systemic Risks in the AI-Driven Future of Banking: Implications for Financial Stability and Business Resilience,” examined the growing risks created by artificial intelligence, digital interconnectivity and increasing dependence on technology.

Yusuf warned that a vulnerability in a bank, fintech, payment service provider or technology vendor could spread to other institutions within the financial ecosystem. She described the potential chain reaction as a “one-fire” effect capable of turning an isolated cyber incident into a broader systemic problem.

She advised financial institutions to regularly assess their technology dependencies and third-party relationships to determine how a failure at one provider could affect critical operations. According to her, resilience should not stop at preventing cyberattacks but should also include the ability to maintain essential services during disruptions and recover quickly afterwards.

Yusuf said the CBN was strengthening its regulatory, supervisory and policy frameworks to identify vulnerabilities that could threaten financial stability before they become major problems. She added that systemic risk considerations were increasingly being examined during the product-approval process.

The CBN director also called for faster reporting of cyber incidents, stronger intelligence sharing among financial institutions and more capable Security Operations Centres that can monitor threats across the financial ecosystem in real time. She urged banks and fintechs to scrutinise the resilience of their technology partners, particularly their ability to withstand and recover from cyberattacks and major operational failures.

On artificial intelligence, Yusuf said financial institutions must balance technological innovation with accountability. She described this approach as “automating accountability,” stressing that human responsibility must remain in place even as AI takes on more sophisticated functions in financial services.

She further urged institutions to strengthen data governance and consider digital sovereignty, including where critical data is stored, who can access it and how information is used to influence financial decisions. Yusuf maintained that regulators, banks, fintechs, payment providers and technology companies must adopt a collective approach to resilience so that disruptions affecting one part of the ecosystem do not destabilise the wider financial system.