How FIs Are Navigating Today’s Risk and Compliance Challenges”

BRENTWOOD, Tenn., June 1, 2023 – A survey by Ncontracts, the leading provider of integrated compliance, vendor, and risk management solutions to the financial industry, and CBANC has uncovered key details about the effectiveness of different governance, risk, and compliance (GRC) strategies and fintech partnerships, providing financial institutions (FIs) with crucial insights to improve risk management and compliance.

The survey of 147 community banks and credit unions shows that the majority of respondents rely on vendors to manage governance, risk and compliance – and those that do tend to have the highest levels of satisfaction with their GRC performance. The survey also found: 

• FIs that rely on a single vendor suite for GRC reported the highest satisfaction levels with nearly a third (30%) of these institutions claiming to have a full understanding of their risk and compliance stature. 
• FIs with a manual approach to GRC were 16.8% more likely to experience examiner questions and concerns about compliance management. 
• Nearly a quarter (24.1%) of FIs that use manual processes report they are “dissatisfied” and that “there are gaps in our data, systems and tools.”
• Just 13% of institutions with more than $10 billion in assets and none of the FIs with between $1 billion and $10 billion use manual processes – a sign that as an institution grows, manual processes simply can’t keep pace.
• More than a quarter of financial institutions (27.6%) plan to add compliance staff.
• Half of banks and credit unions (52.9%) plan to evaluate fintech partnerships in the next one to two years. FIs cited compliance management (72.2%), cybersecurity (62%), return on investment (46.3%), and reputation (44.4%) as top factors for decision-making.

“Financial institutions are investing in GRC, but not every financial institution uses the same approach – and those approaches are not equal,” said Michael Berman, CEO and founder of Ncontracts. “It’s not surprising to see that financial institutions with manual processes encounter more risk management, vendor, and compliance challenges at examination time. In a time where the growth and reputation of financial institutions are at stake, relying on manual GRC processes is no longer a sustainable approach.”

As the regulatory environment becomes more complex, vendor management requirements expand, and the competitive landscape shifts, banks and credit unions that embrace a proactive approach to GRC will have the most valuable data and business insights and the strongest compliance positions. As a result, FIs can gain a competitive advantage.

To support those efforts, Ncontracts introduced its Risk Performance Management (RPM) suite earlier this year to help financial institutions elevate enterprise risk management (ERM) by leaning into improvements in efficiency and speed to improve resiliency, responsiveness, and growth. By combining the company’s industry-leading solutions into one powerhouse suite and leveraging its in-house expertise to offer knowledge as a service (KaaS), Ncontracts helps clients navigate uncertainty and do more with less by transforming data points into actionable insights that inform strategic decision making.

To learn more, attend the free webinar on June 2: GRC Trends 2023 Key Survey Insights for Banks & Credit Unions. Download the full report, The State of GRC: How Financial Institutions Are Navigating Today’s Risk and Compliance Challenges.

About Ncontracts  

Ncontracts provides integrated risk, vendor, and compliance management software to a rapidly expanding customer base of over 4,000 financial institutions, mortgage companies, and fintechs in the United States. The company’s powerful combination of software and services enables financial institutions to achieve their risk management and compliance goals with an integrated, user-friendly cloud-based solution suite encompassing vendor, organizational, audit, and compliance risk management. The company was named to the Inc. 5000 fastest-growing private companies in America for the 4th consecutive year. Visit www.ncontracts.com or follow the company on LinkedIn and Twitter for more information.