Investment in security has topped the banking sector's IT spending priority list for 2005, a study by the Info-Tech Research Group revealed.
The 2005 IT Budget and Staffing Report surveyed more than 1,400 IT decision-makers across various industry sectors including finance, manufacturing, government, agriculture, health and professional services. Eighty-nine per cent of banks surveyed were based in the U.S.
Privacy regulations and other compliance issues are main drivers for banks to spend more on improving their security infrastructure, according to Jason Livingstone, an analyst at Info-Tech based in London.
"Certainly in the last few years, (security) has been right at the very top with respect to IT priorities, (and) it continues to gain prominence with banks," he said.
Fifty-nine per cent of the banks surveyed are planning to increase their investment levels for security, focusing on privacy and security of transactions. Seventy per cent of the banks' IT executives say they will spend money on security software.
Banks are ahead of other sectors in implementing security technologies such as firewalls, anti-spam, intrusion detection, and VPNs. Between 80 to 97 per cent say they have adopted at least one of these systems, the survey said.
Livingstone said with new IT budgets, banks are looking at other forms of security enhancements, specifically on improving inter-branch communications and online transactions.
"Web site security is very critical. Virtually every bank has online banking so there is great focus on protecting that customer interaction through their Web site," he said.
Among the sectors surveyed, banking stood out as having the highest business growth with 78 per cent of respondents saying they are experiencing medium to high growth, the report said.
Banks spend a high proportion of their budgets on IT and a big slice of that relates to securing their systems, said Livingstone. "The nature of their business means they have to, because they are dealing with their clients' bank accounts so security is a must-have."
Increasing protection of consumer data and privacy of information are also some of the top-of-mind issues among opinion leaders at a recent study conducted by IQ Research and Consulting, based in Washington Adobe Systems and security vendor RSA Security jointly commissioned the survey.
Surveying 400 opinion leaders in the Washington area, the study found that 86 per cent think that technology has a strong impact on consumer data protection.
Forty-four per cent of the respondents felt that consumer data theft should be a top priority for government legislators. Creating more secure forms should also be among Congress's "top tier" issues, the survey said.
"Technology needs to fill the gap between technologies for sharing and technologies for safeguarding information," said Bruce Chizen, Adobe's CEO.
Adobe is a leading provider of electronic documents software. Its most popular product, the Adobe PDF software, addresses security in electronic documentation and exchange through its "read only" and password-protect features, among other things.
Chizen said document-level security is a "necessary ingredient in addressing the gap and protecting the privacy, confidentiality and authenticity of information."