These include technologybased failures, cyber incidents, pandemics, and natural disasters. Such events, combined with banks' growing reliance on third-party service providers, expose them to a range of operational risks, which are often difficult to anticipate.
When they manifest, these risks can affect the safety and soundness of affected banks and pose risks to U. S. financial stability by limiting market functioning or undermining trust in the system. We at the Federal Reserve will continue to work in this area to help ensure that banks understand and manage these complex and evolving challenges and that consumers remain protected.