IT would be an insider trader’s dream to know ahead of time which of Europe’s banks will fail or need more capital, and all that data will be stored somewhere in cyberspace as the European Central Bank (ECB) assesses the eurozone’s top banks.

    The chances of a leak are multiplied by the thousands of consultants who will work on data for the ECB’s Comprehensive Assessment of the currency bloc’s most important 128 banks, which include household names like Deutsche Bank and Santander along with national champions Bank of Cyprus and Bank of Valletta.

    “It [data security] is of enormous concern,” said Dan Keeble, a London-based partner at Deloitte, which is working on part of the ECB’s assessment, an Asset Quality Review (AQR) for the eurozone’s 13 largest banks and some smaller ones.

    “Aside from the fact that much of the information required to conduct the AQR is commercially sensitive to individual banks, details of the conclusions regarding the AQR have the potential to be market influencing, and could damage financial stability.”

    That is why the consultants working on the centralized data — U.S. firm Oliver Wyman — cannot cut and paste, take screenshots or print out the data they are working on. And they will only have access to their part of the project, and only for as long as it takes to complete their task.

    Thousands of other consultants working on individual banks face similar restrictions. Anyone caught leaking the information risks a hefty jail sentence, and the ECB said all access to the data is monitored, so users can be traced.

    The ECB, long used to holding sensitive data about its market operations and keeping secret its plans for interest rate changes, told Reuters data security was the “highest priority” in the review it is undertaking before it becomes the eurozone’s financial supervisor in November.

    All data communicated to, from and within the ECB is stored on “Darwin,” the ECB’s document and records management system. Anyone who wants access must file a request through a designated security manager at a national financial supervisor, and the central project management office must approve.

    (SD-Agencies)