The occurrence of a cyber-attack is by some distance the main risk UK financial firms are currently facing, according to a survey carried out by the Bank of England’s Bank Overground blog.

Building societies and banks, along with other market participants, such as hedge funds and pension funds, responded to the half yearly systemic risk survey, with 74% citing a cyber-attack when asked what the main sources of risk were.

In H1 2019, 61% of those surveyed named a cyber-attack when asked this question.

The second risk named, with 59% saying so, is geopolitical risk, with pandemic risk not far behind, at 57%.

Other responses of note include operational risk, at 48%, inflation risk, which garnered only 33% of responses, and regulatory or tax risk, at just 14%.

In 2019, the blog notes, UK political risk was the main worry, with 96% of respondents citing this.

Meanwhile, confidence in the stability of the UK’s financial system over the next three years has improved, with 50% of respondents saying they are ‘completely’ or ‘very’ confident, which is a 17 percentage point improvement on H1 2019, and 45% replied in the opposite, which is down 15 percentage points.

“The risk of a cyber-attack became the most cited risk for the first time since the survey started,” says the blog, adding: “There was a steep increase in the percentage of respondents citing operational risk.

“This category includes risks related to climate change, which was cited by the majority of responses in this category.”

Cyber attack also carries the dubious honour of being the most challenging risk to mitigate, according to 58% of respondents, with pandemic risk and geopolitical risk second and third, at 40% and 32%, respectively.