The Impact of Information Security on Banks’ Performance in Egypt

Abstract

This paper attempts at investigating the impact of information security on the performance of Egyptian banks. This has been conducted using a sample of 13 banks (out of 32 banks), during 2013. Information security is measured by the degree of the application of ISO 27001 and PCI-DSS standards on Egyptian Banks, while banks' performance is measured by indicators of profitability and asset quality.

ISO 27001 specifies the requirements for establishing, implementing, operating, monitoring, reviewing, maintaining and improving a documented Information Security Management System (ISMS). Besides Payment Card Industry Data Security Standards (PCI-DSS) is a multifaceted security standard that includes requirements for security management, policies, procedures, network architecture, software design and other critical protective measures. This comprehensive standard is intended to help organizations protectively protect customer account data.

Results indicate that implementation of ISO 27001 standards may affect profitability indicators as measured by "Return on Capital", while implementation of PCI-DSS standard may affect asset quality as measured by "Non-Performing Loan Ratio".

Keywords: asset quality, Egyptian banks, information security, Information Security Management System (ISMS), ISO27001 certification, PCI-DSS standard