Independent Banker - December 2023 - 18

PORTFOLIO
FOCUS RISK MANAGEMENT
Clarifying regulatory
guidance for third-party
relationships
Earlier this year, federal bank regulatory agencies released final guidance
on third-party risk management for financial institutions. Here's what
community banks need to know. By Susan Thomas Springer
anking models heavily rely
on partnerships, " says Lance
Noggle, senior vice president, operations
and senior regulatory counsel for ICBA.
Now, new regulatory guidance helps
banks improve the management of
such vendor relationships and avoid
regulatory risk.
According to Noggle, community
banks are sometimes wary of third-party
relationships, especially when dealing
with complex and novel products and
services, because it was unclear how
regulators would evaluate them. Now,
consistent " rules of the road " pave
the way for banks to manage these
relationships more confidently.
Final guidance from the Fed,
FDIC and OCC
In June 2023, the Federal Reserve,
Federal Deposit Insurance Corporation
(FDIC) and Office of the Comptroller
of the Currency (OCC) released
final guidance on third-party risk
management for banks.
The guidance covers everything
financial institutions should consider
while working with vendors, from
planning, due diligence and third-party
selection to contract negotiation,
ongoing monitoring and termination.
The guidance states the importance
of providing bank staff with the right
knowledge and skills at each stage of the
risk management life cycle.
The joint guidance from the agencies
replaces the third-party risk guidance
issued in 2021, with emphasis from
regulators on relationships between
banks and fintechs. According to the
agencies, the guidance " promotes
consistency in the agencies' supervisory
approaches toward third-party
risk management. "
Increasing vendor partnerships
Third-party relationships can help
community banks offer new products
and services that would be a challenge
" B
18 // ICBA Independent Banker // December 2023
Illustration by Master1305/Adobe

Independent Banker - December 2023

Table of Contents for the Digital Edition of Independent Banker - December 2023

Contents
Independent Banker - December 2023 - Intro
Independent Banker - December 2023 - Cover1
Independent Banker - December 2023 - Cover2
Independent Banker - December 2023 - Contents
Independent Banker - December 2023 - 2
Independent Banker - December 2023 - 3
Independent Banker - December 2023 - 4
Independent Banker - December 2023 - 5
Independent Banker - December 2023 - 6
Independent Banker - December 2023 - 7
Independent Banker - December 2023 - 8
Independent Banker - December 2023 - 9
Independent Banker - December 2023 - 10
Independent Banker - December 2023 - 11
Independent Banker - December 2023 - 12
Independent Banker - December 2023 - 13
Independent Banker - December 2023 - 14
Independent Banker - December 2023 - 15
Independent Banker - December 2023 - 16
Independent Banker - December 2023 - 17
Independent Banker - December 2023 - 18
Independent Banker - December 2023 - 19
Independent Banker - December 2023 - 20
Independent Banker - December 2023 - 21
Independent Banker - December 2023 - 22
Independent Banker - December 2023 - 23
Independent Banker - December 2023 - 24
Independent Banker - December 2023 - FIS1
Independent Banker - December 2023 - FIS2
Independent Banker - December 2023 - FIS3
Independent Banker - December 2023 - FIS4
Independent Banker - December 2023 - 25
Independent Banker - December 2023 - 26
Independent Banker - December 2023 - 27
Independent Banker - December 2023 - 28
Independent Banker - December 2023 - 29
Independent Banker - December 2023 - 30
Independent Banker - December 2023 - 31
Independent Banker - December 2023 - 32
Independent Banker - December 2023 - 33
Independent Banker - December 2023 - 34
Independent Banker - December 2023 - 35
Independent Banker - December 2023 - 36
Independent Banker - December 2023 - 37
Independent Banker - December 2023 - 38
Independent Banker - December 2023 - 39
Independent Banker - December 2023 - 40
Independent Banker - December 2023 - 41
Independent Banker - December 2023 - 42
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Independent Banker - December 2023 - 50
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Independent Banker - December 2023 - 60
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Independent Banker - December 2023 - 63
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Independent Banker - December 2023 - 65
Independent Banker - December 2023 - 66
Independent Banker - December 2023 - 67
Independent Banker - December 2023 - 68
Independent Banker - December 2023 - Cover3
Independent Banker - December 2023 - Cover4
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