IMF warns of cyber risks to connected financial markets

The International Monetary Fund’s October 2026 Global Financial Stability Report identified cyber disruption as a growing systemic risk for financial markets that are becoming more digital and interconnected. A major attack on payments, trading or access to deposits could cause immediate losses and weaken confidence in the financial system.

Financial institutions increasingly rely on interconnected technologies, cloud services, third-party providers and real-time payment and settlement systems. This has expanded the number of systems that attackers could target. A disruption at one institution or provider could spread to other parts of the financial sector.

The report identified concentration among technology providers as another source of risk. Many financial institutions depend on a small number of major providers and on complex chains of third-party services. These links can create common points of failure that affect several institutions at the same time.

Cyber threats are becoming more sophisticated, according to the report. State-backed groups, ransomware operators and insiders have access to stronger tools, including frontier artificial intelligence models that have shown advanced capabilities in network-attack simulations. The models can support attackers and help defenders improve monitoring, threat detection and automated responses.

Reported software vulnerabilities have risen sharply, while the time between disclosure and exploitation has fallen. In more than 70% of cases recorded in 2026, software providers had almost no time to apply patches before attackers began exploiting the vulnerabilities. That share was 20% higher than a year earlier, according to the IMF.

The report called for stronger basic cyber protections, including cyber hygiene, incident reporting, crisis preparation and oversight of major third-party providers. It identified artificial intelligence as an added reason to improve those measures because the technology can accelerate attacks and defensive operations.

Caio Ferreira, deputy division chief in the IMF’s global markets analysis division, said all countries need to address the risks identified in the report. “Which regions become more vulnerable in this sense are those that do not have appropriate prevention,” Ferreira said. He linked the global shortage of cybersecurity professionals to weaker prevention measures.

Ferreira cited an estimated 40% shortfall in the number of people needed to work in cybersecurity. Emerging markets generally appear less prepared, he said, although cyber threats affect every country. In advanced economies, authorities should improve their understanding of the financial sector’s main points of exposure and the operational links between its different parts, Ferreira said.