Bank executives and boards continue to see technology as driving or facilitating the greatest risks to their institutions: cybersecurity and fraud.

In Bank Director’s 2025 Risk Survey, sponsored by Moss Adams and conducted in January, 84% of bank senior executives and board members cite cybersecurity as a top risk facing their institution. Cybersecurity has always been high on the list of concerns for banks in the annual survey, and anonymous comments from respondents indicated that institutions were adding board members with cybersecurity or technology backgrounds. 

Eighty-three percent said their bank conducted a tabletop exercise of its cybersecurity incident response plan in 2024. Some respondents wrote that the exercise identified dependencies on outside vendors, a need for more specific response plans and better documentation to make the plan run smoother. But some of the takeaways went beyond updates and refinements. 

“We learned that our board has not put the relevant thought behind the actions it would take in the event of a ransomware attack and if (how much) we would be willing to pay,” wrote a community bank chief risk officer. 

Fraud was also a top risk— a concern that resonated with 69% of respondents. Nearly all respondents (94%) reported that their institution or its customers experienced check fraud. Seventy percent had been impacted by the financial exploitation of elderly or vulnerable customers, and 61% had experiences with digital payments fraud. 

“Fraud, fraud, fraud, fraud, fraud,” wrote one small bank CEO. “It’s rampant, and we lose money every quarter due to our customers getting caught up in scams.”

While fraud is a risk that impacts earnings and operations, it has technology components. Many forms of fraud are conducted via email or text, using phishing tactics, personally identifiable information or impersonation to trick the target. Fifteen percent reported that their institution had experienced fraud perpetuated through artificial intelligence or deepfake media.

“Cyber issues are the [No. 1] thing that worries us, from a ransomware attack on the bank to clients being tak[en] advantage of by criminals spoofing the bank. We’re seeing some of our larger, more sophisticated clients falling for some of the scams, which is concerning,” wrote the chief financial officer of a community bank. “And while we do frequent training and testing with our staff, it only takes one employee falling for a scam to let the criminal into our network.”

To address fraud concerns, 86% of respondents said their bank implemented ongoing staff education about the latest scams and threats, and 82% had improved training for bank staff. While the survey didn’t ask how banks were using technology to combat fraud, technology vendors offer services such as transaction monitoring, identify verification, and biometric and behavior markers to aid those efforts.

Other technology-related findings from the survey include:

Few Worried About Keeping Up With Tech
Only 17% of respondents saw an inability to keep up with the pace of technological advances in banking as one of their institutions’ three most significant challenges in the next 18 months. Still, that figure is slightly higher than 14% in 2024. One-fifth were concerned about augmenting their staff with technology or automation, compared to 9% in 2024. 

Focus on Vendors
Almost all respondents (96%) said their bank had undergone a regulatory exam in the last 18 months. Nearly a quarter of those respondents — 24% — said examiners showed heightened attention to the bank’s vendor oversight of third or fourth parties, double from 12% in 2024.

BSA/AML Investment
Forty-six percent said their institution invested in technology to boost its Bank Secrecy Act and anti-money laundering compliance in the past 18 months. 

Pricing Risk
Seventy percent said their cybersecurity insurance premiums increased over the prior 18 months. 

To view the survey results on BankDirector.com, click here.