A survey of financial institution executive management noted concerns that many banks/risk management systems have failed to deliver the full value that was anticipated. Almost two-thirds of the respondents wanted risk management to provide a much more strategic role in management activities and added value to the business charter.
Risk management continues to be defined and driven by regulation, and does not serve as an element of strategic daily management and future planning. Often, risk management is separate from business unit initiatives, and disjointed in action steps.
From emphasizing the development and utilization of enterprise-wide risk management techniques, to focusing on board of directors risk management oversight, this manual offers guidance to bank management teams. Comments and points are provided regarding risk management and risk tolerance considerations. For example, one chapter focuses specifically on enterprise risk management; another chapter has insights regarding the importance of managing third-party relationships. When outsourcing requirements for support work or data processing, the risk still remains with the institution to properly manage risk controls.