The Board of Governors of the Federal Reserve System has been called out for less-than-ideal enterprise risk management. According to a new Government Accountability Office report, the board “has not finalized and implemented its enterprise risk management (ERM) framework, and as a result, it may have limited ability to manage risks across the Large Institution […]
A Missouri bank must pay consumers $5 million in restitution after a third-party vendor deceptively marketed balance transfer credit cards, violating section 5 of the Federal Trade Commission Act according to a Federal Reserve consent order. Mid America Bank in Dixon, Mo., used third-party independent service organizations (ISOs) to market a variety of balance transfer […]
FDIC-regulated banks with more than $1 billion in assets and those that use a model that is “significant, complex, or poses elevated risk to the institution” will be subject to the Supervisory Guidance on Model Risk Management, the same guidance already followed by the Fed and the OCC. Models are already subject to safety and […]
Third-party risk is a hot button issue for regulators. When a financial institution (FI) outsources an activity to an outside vendor, it can introduce all kinds of risk. Vendor management is all about assessing, measuring, monitoring and controlling those risks. Different regulators use different terms to talk about vendor management. While they all ultimately have […]
Well-capitalized, well-managed banks with less than $1 billion in assets must have been on the regulators “nice” list last year. The federal banking agencies, including the FDIC, the Fed and the OCC, have finalized rules permanently extending the exam cycle from 12 to 18 months. It’s a huge sigh of relief for these banks, but they shouldn’t […]
When most bankers and credit union executives think of concentration risk, they think of lending—but concentration risk has a different meaning when talking about third-party vendor management. Regulators are looking at two main concerns: Over-reliance on a single vendor & geographic concentration.
Remember when you were in college and had to decide if you’d do the recommended reading for a class? It wasn’t exactly mandatory, but you never knew if that material would show up on a test. You were taking a risk if you chose to ignore it. Financial institutions run the same risk today if […]
Secret meetings, conspiracy, and intrigue at a place called Jekyll Island. One would hardly associate what sounds like a plot base for a murder mystery period piece with a book about the beginnings of our Federal Reserve. All of this and juicier content permeates author Roger Lowenstein’s book America’s Bank: The Epic Struggle to Create the […]