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Cyberattacks cost UK financial services firms an estimated GBP £1.01 billion over the past year, according to research published by ESET. The study found that 97% of firms surveyed had experienced at least one incident.
The report was based on a survey of 500 UK financial services companies with 50 or more employees and annual revenue of between GBP £500,000 and GBP £500 million. Across those businesses, the average cost of cyber incidents over the past 12 months was GBP £726,000, while 62% of respondents said they had been hit more than once.
Recovery times were also significant. Among firms that suffered an incident, the average time to restore critical business operations was seven days, highlighting the operational disruption as well as the direct financial impact.
Separate consumer research cited in the study suggested breaches can quickly damage customer trust. Only 11% of UK consumers said they would continue using their financial services provider as normal after a major breach that exposed customer data.
Insurance gap
Although cyber insurance was almost universal among the firms surveyed, the research suggested a large share of losses still went uncovered. It found that 99% of respondents had a cyber insurance policy in place, including 41% who had taken one out within the past year.
Yet, on average, 44% of the cost of a cyber incident was not recovered through insurance. Applied across the sector, that would leave firms to absorb as much as GBP £456 million in annual losses.
The findings suggest insurance may reduce some of the immediate financial damage, but it does not shield firms from the full commercial impact of attacks. Customer churn, reputational damage and business interruption remain outside the scope of many claims calculations, even where cover is in place.
Security pressures
The research also pointed to gaps in cyber preparedness despite relatively strong adoption of basic controls. Talent shortages were the leading challenge for 38% of respondents, followed by the demands of running 24/7 security operations at 33% and securing legacy technology at 32%.
Many firms also reported lacking more advanced protections. The study found that 65% did not have a 24/7 managed detection and response service, 57% lacked comprehensive incident response plans, and 60% did not have comprehensive endpoint security.
Another area of concern was hidden compromise. Nearly six in 10 respondents said it was possible their organisation had already been breached without the intrusion being discovered.
AI focus
Artificial intelligence has become a major factor in cyber planning for the sector. The survey found that 46% of firms saw securing AI adoption as their top cybersecurity priority for the next 12 months, while 86% said they had increased cybersecurity investment because of AI.
At the same time, 62% said they did not have an up-to-date AI security policy. That mismatch points to a sector increasing spending in response to perceived risk while still lacking formal governance in many organisations.
The report comes as cyber resilience in financial services remains under close scrutiny following breaches affecting prominent digital finance and crypto groups. Its findings suggest the issue extends well beyond a small number of headline incidents and is affecting companies of different sizes across the wider market.
Steve Round, Co-founder and President at SaaScada, said the scale of recent attacks showed the sector needed to strengthen defences beyond basic measures.
"With almost every FS firm experiencing recent security incidents and financial losses, we're well past warning signs," he said. "Despite relatively strong cyber maturity, organisations urgently need to move beyond the basics. If not, they will continue to face serious financial losses, customer churn, and damaged reputations."
Matt Knell, UK Country Manager at ESET, said firms needed to keep adapting as attackers changed their methods.
"The British FS industry must continue adapting to keep pace with cybercriminals," he said. "That means bolstering their cyber resilience, delivering always-on protection that can keep up with increasingly dangerous cyber threat actors, and taking steps to protect against a rising AI attack surface and AI-powered threats."