Yellen says ransomware attack on China’s biggest bank minimally disrupted Treasury market trades

by AP - 11/10/23 4:18 PM ET

FILE - Bank tellers sit in a branch office of the Industrial and Commercial Bank of China (ICBC) in Hong Kong on March 27, 2013. A financial services business of China’s biggest bank says it was hit by a ransomware attack that reportedly disrupted trading in the U.S. Treasury market. (AP Photo/Kin Cheung, File) — FILE – Bank tellers sit in a branch office of the Industrial and Commercial Bank of China (ICBC) in Hong Kong on March 27, 2013. A financial services business of China’s biggest bank says it was hit by a ransomware attack that reportedly disrupted trading in the U.S. Treasury market. (AP Photo/Kin Cheung, File)

U.S. Treasury Secretary Janet Yellen suggested Friday that a ransomware attack that forced China’s biggest bank to take some systems offline only minimally disrupted the U.S. Treasury market.

She said U.S. and Chinese finance officials discussed the attack in San Francisco, where they met Friday ahead of a regional economic summit next week.

“We’ve not seen an impact on the Treasury market,” Yellen told reporters. “I think it’s an example of why we need close communications. This is situation where it’s critical to be able to pick up the phone and know that you will have a good response on the other end, and that we can trust one another to work together.”

The impacted Industrial and Commercial Bank of China Financial Services handles trades and other services for financial institutions.

In a statement on its website, the bank said a ransomware attack Wednesday forced it to disconnect and isolate affected systems to limit the impact from the attack.

The company, which is based in New York, said it was investigating and had reported the problem to law enforcement.

All Treasury trades executed Wednesday and repo financing trades on Thursday were cleared, it said. It said ICBC’s banking, email and other systems were not affected.

As of August, China held $805.4 billion in U.S. Treasury securities, according to Treasury Department data. It is the second largest holder of U.S. debt after Japan.

A representative from the Securities Industry and Financial Markets Association said it had no comment on the attack.

ICBC gave no further details but reports said the attack was by LockBit, a ransomware syndicate dominated by Russian speakers that does not target former Soviet countries.

It is one of the most efficient ransomware variants around, according to the cybersecurity firm Emsisoft. Active since September 2019, it has attacked thousands of organizations.

Successful cyberattacks on bank are rare. The financial industry is generally among the best protected, with serious investment in cybersecurity and segmented operations to discourage theft.

___

Treasury reporter Fatima Hussein contributed to this report from Washington, D.C.

Tags