Cybersecurity Risk Management and Strategy

Cybersecurity risks are continually evolving, becoming increasingly complex and pervasive across all industries. To mitigate these cybersecurity risks and protect nonpublic, personally identifiable customer data, financial transactions and our classified information systems, the Bank has implemented a comprehensive information security program, which is a component of its overarching enterprise risk management program. Key components of the information security program include:

• A risk assessment process that identifies and prioritizes material cybersecurity risks; defines and evaluates the effectiveness of controls to mitigate the risks; and reports results to executive management and the Board of Directors.

• Annual security assessments that proactively identify potential vulnerabilities that are both externally facing and internal within the bank’s infrastructure; reports the results for all assessments to executive management and the Board of Directors with tracking and resolution to potential areas of risk.

• Vulnerability management program that patches known vulnerabilities across operating systems and software platforms.

• Strong controls around user access including creation, changes and termination of access, ongoing user access reviews, multifactor authentication and password policies.

• A technology team covering all critical cyber defense functions such as engineering, data protection, identity and access management, insider risk management, security operations, threat emulation and threat intelligence.

• A training program that educates employees about cybersecurity risks and how to protect themselves from cyberattacks.

• An awareness program that keeps employees informed about cybersecurity threats and how to stay safe online.

• An incident response plan that outlines the steps the Bank will take to respond to a cybersecurity incident, which is tested on a periodic basis.

• Adoption and implementation of a layered defense / defense in depth model n which security systems are linked or stacked so that the strengths of one security system compensate the weaknesses of the other system.

• Additional controls that include but not limited to data encryption; change management; end of life management; asset management; malware and antivirus detection, response and mitigation; physical security; business continuity and disaster recovery management.

The Bank engages reputable third-party assessors to conduct various independent audits on a regular basis, including but not limited to maturity assessments and various testing. Following a defense-in-depth strategy, the Bank leverages both in-house resources and third-party service providers to implement and maintain processes and controls to manage the identified risks.

The Bank’s Third-Party / Vendor Risk Management program is designed to ensure that our vendors meet our cybersecurity requirements. This includes conducting periodic risk assessments of vendors, requiring vendors to implement appropriate cybersecurity controls and monitoring vendor compliance with our cybersecurity requirements.

The Bank’s information security program and strategy are designed to ensure the Bank's information and information systems are resilient and appropriately protected from a variety of threats, both natural and man-made. Periodic audits and risk assessments are performed to validate control requirements and ensure that the Bank’s information is protected at a level commensurate with its sensitivity, value, and criticality. Preventative and detective security controls and policies are employed on all media where information is stored, the systems that process it, and infrastructure components that facilitate its transmission to ensure the confidentiality, integrity, and availability of Bank information. These controls and policies include, but are not limited to access control, data encryption, data loss prevention, incident response, security monitoring, third party risk management, and vulnerability management.