Asian govts, central banks to work together to prevent repeat of cyber heist

Monday, 18 April 2016 00:00 -     - {{hitsCtrl.values.hits}}

Washington: Governments and central banks in Asia, including India, will work together to protect their systems from hackers to avoid a repeat of the daring cyber heist on Bangladesh Bank, the central bank of Bangladesh.

Coordinated action to tackle this menace is the need of the hour, Sri Lankan Minister of Finance Ravi Karunanayake said after a meeting of the finance ministers from G24 countries, comprising emerging economies including India.

“What happened in Bangladesh was a clear-cut case of hacking. There was a lack of awareness amongst central bankers in the Asian region. We have decided that there will be a grouping of knowledge, pooling of resources and coordinated action to eradicate such things,” he said. “Even India’s Minister of Finance Arun Jaitley flagged this issue today in the meeting,” Karunanayake added.

In February, hackers posing as officials of the Bangladeshi central bank asked the US Federal Reserve to transfer more than $ 951 million to private accounts based in Sri Lanka and the Philippines. A small spelling error led to the unravelling of the heist, but not before $ 101 million was stolen.

The daring heist brought the spotlight back to the security systems of central banks across the world and the need to fortify such systems, given the increasing sophistication and reach of hackers.

“We don’t know to what level it has seeped in... we are trying hard to get that insulation and all central bankers are working together for this,” Karunanayake said, adding that even advanced economies are extending help to prevent such occurrences in the future.

The G24 countries also pushed for the full implementation of the 2010 quota and governance reforms at the International Monetary Fund (IMF).

“We welcome the entry into force of the 2010 Quota and Governance Reforms of the IMF that have made progress in shifting the distribution of quota shares to EMDCs (emerging market developing countries), and note that there is still a long way to go in this respect. We call for the full implementation of the 2010 governance reforms, including those on Board representation,” the official communique said.

In January this year, the IMF notified the governance quota reforms adopted in 2010, increasing the voting rights of emerging-market economies such as India and China.

This increased India’s share at IMF to 2.75% from 2.44%, making it the eighth-largest shareholder in the multilateral agency. Following this, India has been pressing for the speedy conclusion of the next round of quota reviews.

“We look forward to the completion of the 15th General Review of Quotas by the Annual Meetings in 2017, and to a new quota formula that further shifts quota shares to EMDCs while protecting the quota share of the poorest countries,” the communique added, pointing out that the realignment of quotas must reflect the rapidly growing weight of such economies in the global economy.

The countries also pushed for putting greater weight to GDP measured in purchasing power parity (PPP) in determining the economic weight of countries. (Source: