In early 2013, the chief risk officers and directors who responded to Bank Director’s 2013 Risk Practices Survey demonstrated a lot of confidence in how their banks managed risk. Despite challenges posed by the regulatory environment, as well as concerns about maintaining the technology and data infrastructure to support risk decision-making, the vast majority said they were confident in their institution’s ability to manage risk across all lines of business. With increased attention reported at the board level, it’s no surprise that risk has grown to be top of mind for bank boards, and with almost 70 percent reporting that the bank had an enterprise risk management (ERM) program in place (and another 12 percent transitioning to ERM), this confidence was understandable.
Next week will see the release of the results to Bank Director‘s 2014 Risk Practices Survey, sponsored by FIS. This survey broadens the audience to banks below the Dodd-Frank threshold of $10 billion in assets, and will offer some real insights into how these smaller banks approach risk. Instead of looking into how confident banks are in the management of risk, we’ll take a quantifiable view of how developed these banks’ risk programs are, as well as how developed their approach is to risk management. You may be surprised by some of the findings. Stay tuned.