'Replace IBM servers now,' Chinese government tells banks

NSA spying row escalates as China's government urges banks to replace IBM hardware

The Chinese government has urged domestic banks to stop using high-end IBM servers and replace them with locally made equivalents, according to a Bloomberg newswire report.

The instruction follows an escalation in the international dispute over US National Security Agency (NSA) spying, particularly after journalist Glenn Greenwald published a photograph of NSA staff unboxing an exported Cisco router in transit in order to install a bug on the device.

Bloomberg cites four "people familiar with the matter" to support its claims.

According to the newswire, the People's Bank of China and the Ministry of Finance are examining whether Chinese banks' reliance on IBM servers risks compromising the country's financial security. The servers are presumably System-Z mainframes.

In the last week, China's government announced that it will "vet" technology companies operating in the country, while the Financial Times has reported that state-owned companies have been ordered not to use US IT services and consulting companies. Microsoft's Windows 8 operating system has also been banned from recent government procurements, too, in a move that the Xinhua News Agency called "a move to ensure computer security".

The review into the country's financial security will be overseen by a working group on internet security set up by President Xi Jinping, according to Bloomberg.

Computing was awaiting comment from IBM at the time of writing.