$98.2 million – that’s how much the Australian financial giant lost due to the March cyberattack.
Australian consumer finance company Latitude Group posted a net loss of $98.2 million in the first half of 2023. The reason was the March cyber attack, as a result of which the attackers stole almost 8 million driver's licenses and millions of other confidential customer documents.
This result contrasts sharply with net income of $30 million for the same period last year. At the same time, the costs associated directly with the cyberattack amounted to about $76 million for Latitude.
As a result of a cyberattack, operations on issuing new loans and collecting debts on old ones were completely suspended for 5 weeks. This had an immediate impact on Latitude's operating results.
Lending volumes in the segment of cash loans in Australia and New Zealand decreased significantly - by 19%. In addition to the cyberattack, the results were also affected by high inflation, lower consumer incomes and slower retail sales.
Comparing the results with last year, taking into account the cost of a cyber attack, one can assume that the company could have gone into the red even without an incident, but hackers have significantly aggravated the situation.
In a recent statement, CEO Bob Belan noted that the first half of this year has been one of the toughest in Latitude's history. However, he is proud of the team's resilience and is pleased with the pace of business recovery.
Belan said Latitude will continue to work to strengthen cybersecurity and improve customer service, focusing on the core areas of lending and remittances.
Despite the current difficulties, Latitude reaffirmed its previous net profit forecast of $15-25 million for the full 2023. This testifies to the management's confidence in a speedy recovery of the business. And these predictions are not unfounded.
Positive dynamics is observed in the segment of premium credit cards. Demand for the Latitude 28° Global Platinum Mastercard was up 29% due to increased international travel. The financial volume for this product reached $1 billion, which is in line with pre-pandemic indicators.
In the first half of the year, the company entered into partnerships with a number of new retail chains. Work is also underway to attract other large retailers. The sale of Hallmark's insurance division freed up about $99 million in capital to support Latitude's liquidity. At the same time, taking into account all costs, this transaction adjusted the company's losses to $18.7 million.
The cyberattack on Latitude Group clearly demonstrated the vulnerability of businesses in the face of growing cyber threats. The hackers managed to gain access to the confidential data of millions of customers, which led to enormous damage to the company.
This incident once again highlights the importance of investing in cybersecurity and developing robust security systems. Companies should prioritize securing the storage and transfer of customer personal data. This is a key factor in maintaining consumer confidence in the digital age.
Australian consumer finance company Latitude Group posted a net loss of $98.2 million in the first half of 2023. The reason was the March cyber attack, as a result of which the attackers stole almost 8 million driver's licenses and millions of other confidential customer documents.
This result contrasts sharply with net income of $30 million for the same period last year. At the same time, the costs associated directly with the cyberattack amounted to about $76 million for Latitude.
As a result of a cyberattack, operations on issuing new loans and collecting debts on old ones were completely suspended for 5 weeks. This had an immediate impact on Latitude's operating results.
Lending volumes in the segment of cash loans in Australia and New Zealand decreased significantly - by 19%. In addition to the cyberattack, the results were also affected by high inflation, lower consumer incomes and slower retail sales.
Comparing the results with last year, taking into account the cost of a cyber attack, one can assume that the company could have gone into the red even without an incident, but hackers have significantly aggravated the situation.
In a recent statement, CEO Bob Belan noted that the first half of this year has been one of the toughest in Latitude's history. However, he is proud of the team's resilience and is pleased with the pace of business recovery.
Belan said Latitude will continue to work to strengthen cybersecurity and improve customer service, focusing on the core areas of lending and remittances.
Despite the current difficulties, Latitude reaffirmed its previous net profit forecast of $15-25 million for the full 2023. This testifies to the management's confidence in a speedy recovery of the business. And these predictions are not unfounded.
Positive dynamics is observed in the segment of premium credit cards. Demand for the Latitude 28° Global Platinum Mastercard was up 29% due to increased international travel. The financial volume for this product reached $1 billion, which is in line with pre-pandemic indicators.
In the first half of the year, the company entered into partnerships with a number of new retail chains. Work is also underway to attract other large retailers. The sale of Hallmark's insurance division freed up about $99 million in capital to support Latitude's liquidity. At the same time, taking into account all costs, this transaction adjusted the company's losses to $18.7 million.
The cyberattack on Latitude Group clearly demonstrated the vulnerability of businesses in the face of growing cyber threats. The hackers managed to gain access to the confidential data of millions of customers, which led to enormous damage to the company.
This incident once again highlights the importance of investing in cybersecurity and developing robust security systems. Companies should prioritize securing the storage and transfer of customer personal data. This is a key factor in maintaining consumer confidence in the digital age.
