The Federal Financial Institutions Examination Council (FFIEC) has officially announced that its Cybersecurity Assessment Tool (CAT) will phase out by August 31, 2025. Launched in June 2015, the CAT has helped financial institutions assess and improve their cybersecurity posture. However, with cybersecurity threats constantly evolving, the FFIEC has decided it’s time to move on. This means that institutions will need to shift to more modern frameworks.

In this blog, we’ll explain what this means for financial institutions and suggest alternative tools you can explore.

Why Is the FFIEC Sunsetting the CAT?

The FFIEC cyber assessment tool was developed as a free, structured framework to help financial institutions assess their cybersecurity maturity levels. It was highly valuable in its time, offering a detailed guide for identifying vulnerabilities, evaluating risks, and implementing controls.

However, as cybersecurity threats have grown in complexity and sophistication, the CAT has not kept pace. Today, frameworks like NIST’s Cybersecurity Framework (CSF), which has recently been updated to version 2.0, and the Cybersecurity Performance Goals (CPGs) from the Cybersecurity and Infrastructure Security Agency (CISA), offer more robust, adaptable approaches. As a result, the FFIEC has made the strategic decision to retire the CAT, leaving financial institutions to explore more up-to-date tools and methodologies.

The FFIEC removed the CAT from its website at the end of August, and there will be no further updates to the tool or associated resources. If your institution has relied on the CAT for cybersecurity assessments, it’s time for a reset.

FFIEC’s Role in Financial Cybersecurity

For readers unfamiliar with the FFIEC, it’s worth adding some background about this key organization. The Federal Financial Institutions Examination Council (FFIEC) was established in 1979 to provide uniform principles, standards, and report forms for federal regulators’ examination of financial institutions. The council’s cybersecurity efforts are crucial in promoting regulatory cooperation and creating guidance for cybersecurity risk management across the financial sector.

The FFIEC is composed of several major regulatory bodies, including:

• The Federal Reserve Board (FRB)
• The Federal Deposit Insurance Corporation (FDIC)
• The Office of the Comptroller of the Currency (OCC)
• The National Credit Union Administration (NCUA)
• The Consumer Financial Protection Bureau (CFPB)

The FFIEC is responsible for issuing guidelines, frameworks, and tools like the CAT to help financial institutions maintain a secure and resilient cyber environment.

Understanding the Importance of Cybersecurity in Financial Institutions

Why does all of this matter? 

Financial institutions are among the most heavily targeted by cyberattacks. As digital banking continues to grow and fintech companies innovate, the risk of breaches, fraud, and other attacks increases. Here are some reasons why cybersecurity is critical for financial institutions:

• Data Sensitivity: Financial institutions store vast amounts of sensitive data, including personal financial information, Social Security numbers, and transaction histories. A breach can lead to identity theft, fraud, and financial losses for both customers and the institution.
• Regulatory Scrutiny: Financial institutions must comply with strict regulations like Gramm-Leach-Bliley Act (GLBA), Payment Card Industry Data Security Standard (PCI DSS), and state-level privacy laws like California’s CCPA. Cybersecurity failures often lead to significant regulatory penalties and reputational damage.
• Reputation and Trust: Trust is a cornerstone of the financial industry. A high-profile cybersecurity failure can irreparably damage an institution’s reputation, leading to customer attrition and loss of business.

Given these risks, adopting the right cybersecurity tools and frameworks is critical for any financial institution’s long-term viability.

FFIEC Recommendations: Moving to Modern Frameworks

The FFIEC recommends that financial institutions adopt more modern cybersecurity frameworks to ensure a smooth transition. Here’s a breakdown of the key alternatives:

1. NIST Cybersecurity Framework (CSF) 2.0

The NIST CSF 2.0 is a major evolution of the original framework. It’s widely used by organizations of all sizes and sectors, including financial institutions, to manage and reduce cybersecurity risks. With its comprehensive and flexible approach, the CSF 2.0 allows institutions to adapt to their specific risk profiles while staying aligned with regulatory expectations.

As the FFIEC sunsets the CAT, transitioning to the FFIEC framework based on NIST CSF 2.0 will help financial institutions maintain strong cybersecurity controls and risk management processes. The framework includes updates in cybersecurity governance and supply chain risk management, both critical to today’s threat landscape.

2. Cybersecurity Performance Goals (CPGs)

Another resource to consider is CISA’s Cybersecurity Performance Goals (CPGs). Released in 2023, these goals were developed to provide clear, actionable targets for organizations to improve their cybersecurity resilience. Although the CPGs are designed to apply across sectors, CISA plans to release specific financial goals, which could serve as an excellent roadmap for institutions looking to enhance their cybersecurity defenses.

The FFIEC has already indicated that CPGs will play a key role in future FFIEC cybersecurity compliance efforts, so financial institutions should keep an eye on this resource as they move away from the CAT.

3. Industry-Developed Tools

In addition to government frameworks, the FFIEC encourages institutions to explore industry-specific tools, such as the Cyber Risk Institute’s (CRI) Cyber Profile and the Center for Internet Security’s (CIS) Critical Security Controls. Both of these tools are highly relevant to financial institutions and offer targeted guidance on managing cyber risks while aligning with regulatory standards.

The CRI Cyber Profile is specifically tailored for the financial sector, making it an excellent option for institutions seeking a replacement for the CAT. Similarly, the CIS Critical Security Controls provide prioritized actions to improve your cybersecurity posture based on the most prevalent threats facing organizations today.

The Future of FFIEC Cybersecurity Compliance

With the sunset of the FFIEC cyber security assessment tool, financial institutions can modernize their cybersecurity programs in ways better suited to today’s risk environment. Adopting newer frameworks like NIST CSF 2.0 and leveraging industry-developed tools can enhance your organization’s security posture and stay ahead of regulatory expectations.

The next couple of years will be pivotal for financial institutions in terms of adopting these new standards, so don’t wait until the last minute. Start planning now, and ensure your institution is fully prepared for the FFIEC framework transition.

Looking at the Bright Side of the Setting Sun

The retirement of the FFIEC CAT marks a significant change, but it’s also an opportunity to strengthen your institution’s cybersecurity posture with more modern, flexible tools.

Additional Resource: https://www.ffiec.gov/press/pdf/CAT_Sunset_Statement_FFIEC_Letterhead.pdf

The post FFIEC Will Sunset the Cybersecurity Assessment Tool: Everything You Need to be Prepared appeared first on Centraleyes.

*** This is a Security Bloggers Network syndicated blog from Centraleyes authored by Rebecca Kappel. Read the original post at: https://www.centraleyes.com/ffiec-the-cybersecurity-assessment-tool/