Chinese Banks To Remove IBM Servers On Security Claims
Shares of International Business Machines (NYSE: IBM) trend lower following Bloomberg's report that the Chinese government is reviewing whether banks reliance on the company's servers compromise the “nation's financial security.”
Bloomberg News wrote, “Government agencies, including the People's Bank of China and the Ministry of Finance, are asking banks to remove the IBM servers and replace them with a local brand as part of a trial program, said the four people, who asked not to be identified because the review hasn't been made public.”
The examination followed the U.S. indictment announced on May 19 of five Chinese military officers for “allegedly hacking into the computers of U.S. companies and stealing secrets.” In the report, the State Internet Information Officer compared the United States actions to “a thief yelling ‘Catch the thief.'”
Spokesman for IBM, Jeff Cross, wrote in an e-mail statement to Bloomberg, “IBM is not aware of any Chinese government policy recommending against the use of IBM servers within the country's banking industry. In fact, news reports now state that China's National Development and Reform Commission has not heard of any alleged directive to that effect. IBM is a trusted partner in China and has been for more than 30 years.”
Shares of IBM closed at $185.94 on Friday. The stock traded as low as $184.18 on Tuesday morning, down about one percent following the report.
© 2015 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.