New rule gives banks 36 hours to disclose cybersecurity incidents
On November 18, the FDIC, Federal Reserve Board, and the OCC issued a final rule intended to enhance information sharing about cyber incidents that may affect the U.S. banking system. The final rule, among other things, requires a banking organization to timely notify its primary federal regulator in the event of a significant computer-security incident within 36 hours after the banking organization determines that a cyber incident has taken place. The final rule notes that notification is required for incidents that have affected, in certain circumstances: (i) the viability of a banking organization’s operations; (ii) its ability to deliver banking products and services; or (iii) the stability of the financial sector. Additionally, the final rule requires a bank service provider to notify affected banking organization customers as soon as possible when the provider determines that it has experienced a computer-security incident that has materially disrupted or degraded, or is reasonably likely to materially dispute or degrade, a banking organization’s customers for four or more hours. The final rule further provides that the notification requirement for bank service providers is important since “banking organizations have become increasingly reliant on third parties to provide essential services,” which may also experience computer-security incidents that could affect the support services they provide to banking organization customers, along with other significant impacts. The rule is effective April 1, 2022, and banking organizations are expected to comply with the final rule by May 1, 2022.