2021 Assessment of the Reserve Bank Information and Transfer System 1. Executive Summary
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Purpose
This report is an assessment of the Reserve Bank Information and Transfer System (RITS), which is operated by the Bank's Payments Settlements Department. The Assessment was independently prepared by the Bank's Payments Policy Department and endorsed by the Payments System Board. It covers the period from April 2020 to March 2021.
Approach
RITS has been assessed against the Principles for Financial Market Infrastructures (the Principles). These international standards were developed by the Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO).[1] The assessment was carried out in accordance with the approach and rating system set out by CPMI and IOSCO in Principles for Financial Market Infrastructures: Disclosure framework and assessment methodology (the Disclosure Framework) and Application of the Principles for Financial Market Infrastructures to Central Bank FMIs.[2]
Conclusion
This Assessment concludes that, at end March 2021, RITS observed all of the relevant Principles, except for Principle 13 (Participant-Default Rules and Procedures) and Principle 17 (Operational Risk), which it broadly observed.
Recommendations
To observe Principle 13 (Participant-Default Rules and Procedures), Payments Policy Department recommends that the Bank formally document its decision-making and crisis-management arrangements in the event of a RITS member default, including consultation arrangements with other authorities and communications with industry.
To observe Principle 17 (Operational Risk), Payments Policy Department recommends the Bank:
- complete implementation of all initiatives related to the Bank's Technology Stability Improvement Program (TSIP) that are material to the continued operational stability of RITS
- complete implementation of proposals to improve oversight of maintenance activities conducted by external contractors on the Bank's critical infrastructure, including establishing an enhanced internal engineering review and advisory function.
Oversight focus
Over the coming assessment period, areas of particular focus in the oversight of RITS will include:
- developments designed to ensure that RITS remains resilient in the face of evolving cyber-security threats. Specifically, Payments Policy Department will monitor progress in the continued exploration of enhancements to the ability to limit exposure to cyber risk and recover RITS from cyber-attacks in a timely manner.
- the impact of planned upgrades to the Bank's physical infrastructure on the operational stability and resilience of RITS.