US Banks Heighten Cyberattack Alert Amid Iran Conflict

The U.S. financial services industry is on heightened alert for potential cyberattacks amid the unfolding U.S. war in Iran, with firms stepping up monitoring for threats. Executives and analysts state that such threats often rise during periods of geopolitical conflict.

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The killing of Iranian Supreme Leader Ali Khamenei last weekend in an air strike has sparked a conflagration in the Middle East. This has roiled global markets and heightened concerns about potential Iran-linked cyberattacks on U.S. financial services operations.

Cybersecurity has long been a top priority for the financial services industry. The sector operates critical U.S. infrastructure, including payments, clearing and settlement systems, as well as trading platforms and Treasury markets, making it a top target of cyberattacks, according to industry data.

Todd Klessman, managing director for financial services cyber and technology at industry group SIFMA, stated that the industry remains vigilant and ready to respond to cyber threats at all times. He added that this vigilance is especially important when global cybersecurity risks are elevated.

SIFMA conducts annual exercises to ensure financial firms maintain operations during major cyber emergencies. Klessman noted, "We continue to monitor the current situation with a focus on operational resilience, which is foundational to the integrity and stability of the U.S. capital markets."

Another senior banking industry official expressed deep concern regarding the risk of cyberattacks, deeming them likely. According to a U.S. intelligence assessment that Reuters reported on Monday, Iran-aligned "hacktivists" could conduct low-level cyberattacks against U.S. networks.

These potential low-level attacks could include distributed denial-of-service attacks, or DDoS, where hostile actors overwhelm a targeted server with a flood of internet traffic.

Credit rating agency Morningstar DBRS said on Tuesday the most significant risks to global banks and asset managers were likely to be indirect. These risks include sustained higher oil prices and shocks to borrowers, though the agency warned that cyber risks could also increase.

The credit rating agency stated, "Iran could increase its cyberattacks against Western entities, including banks." U.S. investment bank Lazard’s geopolitical advisory team also this week flagged cyber risks.

Lazard’s team noted that Iran has shown a willingness to deploy cyber capabilities against commercial targets, including financial systems.

A 2025 report by the Financial Services Information Sharing and Analysis Center, FS-ISAC, an industry consortium, found the financial services sector was the top target of DDoS attacks in 2024. The Hamas-Israel and Russia-Ukraine wars fueling a surge in hacktivism.

While the industry has not recently suffered a major disruption from a hostile attack, smaller-scale DDoS and ransomware attacks have disrupted parts of the market.

A 2023 ransomware attack on the U.S. broker-dealer unit of Industrial and Commercial Bank of China disrupted the settlement of some U.S. Treasury trades.

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• The U.S. financial services industry is on high alert for potential cyberattacks.

• The escalating conflict in Iran and the killing of its Supreme Leader are cited as reasons for heightened concern.

• U.S. intelligence suggests Iran-aligned "hacktivists" could conduct low-level cyberattacks, such as DDoS.

Source: REUTERS