“Cloud computing is driving both the digital transformation of banks and the EU Digital Single Market. We need to create a safe and clear regulatory environment so that both banks and supervisors can do their job well.”

Wim Mijs
Wim MijsEBF Chief Executive Officer

“Understanding the risks of cloud computing is essential to unlock its potential. European banks use technology widely to maintain resilience, boost innovation and support their clients, especially at times when digital infrastructure is necessary to respond to high usage at all levels…
Part.1

Alexandra Maniati
Alexandra ManiatiEBF Director of Cybersecurity & Innovation

…The Cloud Banking Forum is a unique example of cross-industry cooperation that reflects the ambitions of the digital strategy of EBF and our wider banking community.”
Part.2

Alexandra Maniati
Alexandra ManiatiEBF Director of Cybersecurity & Innovation

“ The success of our first Cloud Banking conference and the launch of the EBF Cloud Banking Forum demonstrates that there is a willingness to innovate and a thirst for clear rules in cloud banking.”

Wim Mijs
Wim MijsEBF Chief Executive Officer

“In a future world of minimum retained IT with a high level of agility, variable costing, improved time-to-market and broad usage of AI and other exponential technologies, cloud will play a very important role. But before banks can reap the benefits from a multi-cloud environment, the security, operational, legal and compliance requirements need to be crystal clear, allowing for a cloud approach which is integrated, economically viable and at scale…

Part.1

Patrick Maes
Patrick MaesGlobal Head of User Solutions, Credit Suisse/Chair of the EBF Cloud Banking Expert Group

…To achieve this, we need to collaborate with cloud service providers and regulators. The Cloud Banking Forum is the platform for these types of discussions, highlighting the importance of cloud computing as the undeniable core technology for banks and supervisors.”

Part.2

Patrick Maes
Patrick MaesGlobal Head of User Solutions, Credit Suisse/Chair of the EBF Cloud Banking Expert Group
CLOUD ADOPTION BY EUROPEAN BANKS

Digitalisation of services and globalisation have led to significant changes in methods of data collection, access and use. Especially in the banking industry.
This has recently contributed to an increased interest in cloud computing as a means to support the digitalisation of financial services. It is not only about storing data in the cloud but outsourcing your computing power meeting the business needs. By doing so, cloud-based infrastructures can be a driving force behind better software performance, data analytics, and emerging technologies such as distributed ledgers and artificial intelligence.

However, banks have been slower in their uptake of cloud services when compared to other industries due to the strict regulatory environment where banks operate in. Correspondingly, legal and regulatory constraints limit cloud adoption in banking, but also the lack of harmonised regulatory approaches across different jurisdictions and between regulators contributes to a high threshold. Moreover, using, managing and storing customer information faces higher compliance risks, especially in an international environment and in the light of data and security guidelines (e.g. GDPR).

The contractual negotiations between banks and cloud service providers (CSPs) are facing significant frictions.

Cloud computing in many forms (private, public, hybrid). Public cloud solutions let service providers make resources like apps and storage available via an accessible network where multiple clients can share the same resources.  A hybrid cloud is an integrated cloud service utilising both private and public clouds to perform distinct functions within the same organisation.
These forms can be deployed through different service models.

Moving beyond legacy infrastructure, the journey to cloud-driven organisation knows several phases. As banks are keen to use the innovative potential of cloud technology they take into account risk management and organisational structure.

EBF CLOUD BANKING FORUM

The EBF Cloud Banking Forum is a unique attempt to create a dialogue between relevant authorities, cloud service providers (CSPs) and banks aimed to enable the creation of a harmonised supervisory approach towards cloud computing and to support the rapid adoption of public/hybrid cloud solutions in the banking sector.
In its initial work streams, the EBF Cloud Banking Forum created three technical papers, reflecting important aspects for cloud adoption by European banks. By the support of a harmonized regulatory framework through suggestion of voluntary best practices and provision of educational background, Cloud Service Providers and European banks are looking to avoid detrimental fragmentation for cloud computing across the EU. To that end, the papers reflect on special features of cloud use by financial institutions and address requirements under the EBA Guidelines on outsourcing arrangement from a cloud-specific perspective.
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Cloud banking summary note

After an initial engagement with its EU observers in the past, the Cloud Banking Forum is looking forward to discussing the proposed papers with the observers in detail. Insights gained from these conversations will help to shape the products of the Forum further, updating them in the face of a fast-developing cloud environment that continues to evolve.

EBF CLOUD BANKING FORUM: TECHNICAL PAPERS

CLOUD INITIATIVES OF EU INSTITUTIONS

According to the European Commission, cloud computing is developing fast. Estimates indicate that these developments could lead to the growth of the European cloud market from €9.5bn in 2013 to €44.8bn by 2020, i.e. almost five times the market size in 2013. Within the Digital Single Market Strategy for Europe, the key role of cloud computing is established through the European Cloud Initiative and through the initiative on Building a European Data Economy.

The European Cloud Initiative focuses is complemented by other initiatives under the Digital Single Market (DSM) to promote the development and uptake of cloud services, focusing on certification, switching of cloud service providers and security. These actions incorporate input from the European Cloud Partnership (ECP) and the Cloud Select Industry Group (C-SIG).

The EBF works together with the Commission on several topics and projects. The Commission is also an observing member of the EBF Cloud Banking Forum.

Digital Single Market and Cloud Computing

16 April 2018: Cloud stakeholder working groups start their work on cloud switching and cloud security certification

10 June 2019 – European Trusted Cloud Service Provider Working Group (CSP CERT): Final Public-Private recommendation for a European Security Certification Scheme

The European Banking Authority (EBA) and the European Central Bank (ECB) are also important partners in this work stream. Below you can find relevant publications from the EBA, ECB and European Supervisory Authorities (ESAs).


European Supervisory Authorities: Joint advice on the need for legislative improvements relating to ICT risk management requirements in the EU financial sector

European Banking Authority: Guidelines on outsourcing arrangements

European Banking Authority: Recommendations on outsourcing to cloud service providers


European Central Bank Outsourcing opportunities and challenges

EBF CLOUD BANKING CONFERENCE

European banks want to adopt innovative cloud technology, to allow them to – operate in a fast-developing digital environment, to serve customers and to adapt their business in order to strive for the EU’s digital leadership role.

In December 2017, the European Banking Federation launched the EBF Cloud Banking Forum, a policy hub on cloud computing for European banks and Cloud Service Providers to support a harmonised supervisory approach towards cloud computing. This will facilitate the adoption of public/hybrid cloud computing by European banks on a larger scale.

The 2nd EBF Cloud Banking Conference will present the results of this cooperation and allow supervisory authorities, representatives of EU institutions, Cloud Service Providers and European banks to engage on the future of cloud adoption, from both a European and global perspective. The event will also prove valuable in the context of the implementation of the European Banking Authority’s Guidelines on outsourcing arrangements.

HIGHLIGHTS FROM THE 2019 EVENT

For information on the 2017 edition please visit this page

EBF ADVISER
Julian Schmücker

Julian Schmücker

Policy Adviser - Digital