ABA Banking Journal - August 2014 - (Page 36)

compliance clinic RISK MANAGEMENT BEAT EXAMINERS TO THE PUNCH Risk-based compliance helps banks detect their own emerging risks W hen an examiner requests a meeting dur ing an examination to discuss some trend or pattern that's been spotted in the bank's numbers, it's too late to begin thinking about getting ahead of the curve. More than likely, the bank is already headed toward remedial work, some internal embarrassment, or even some reputational damage. And those consequences could have been anticipated and prevented had the bank been taking more of a forward-looking attitude in measuring, tracking, and evaluating its activities, and then deciding what the numbers it generated implied about the bank. As compliance begins to blend more into risk management, banks have to look ahead and figure out not only what monitored behavior adds up to, but how it will look to regulators in the context of newer filters like 36 | ABA BANKING JOURNAL | AUGUST 2014 UDAAP (unfair, deceptive, and abusive acts and practices), and whatever challenges await over the horizon. "Understanding emerging risks requires a heightened awareness of changing conditions and an assessment of the risk's impact, its connection to other risks, and implications for a bank's strategy," said Carol Yee, senior vice-president and chief compliance officer at People's United Bank, during ABA's Regulatory Compliance Conference earlier this year. The conference session Yee and her fellow speakers gave was titled "Emerging Risk: Defining the Canary in a Coal Mine." Fellow speaker Andrew Steinbaugh, senior compliance manager at $16.2 billion-assets First National Bank of Omaha, pointed out that in an era in which the Consumer Financial Protection Bureau (CFPB) describes itself as a "data-driven" organization, it behooves banks to gather data about their operations. "But it's not just that we have the data," said Steinbaugh, "but what we do with it that matters." Yee said that a key point of the data is pinpointing risk issues. Without solid means of measuring and recording risks taken, the bank has no means of seeing where risk stands and setting its whole-bank risk appetite. In Yee's presentation, she stressed the importance of tracking and evaluating trends not only for the use of the compliance and audit functions, but for the direct feedback to executives of business units. That is how the $32.9 billion-assets bank, based in Bridgeport, Conn., attempts to stay ahead of the curve. However, what especially stood out was how the bank looks at not only end results of its policies, processes, and actions, but at interim issues. PHOTOS: SHUTTERSTOCK.COM BY STEVE COCHEO, EXECUTIVE EDITOR AND DIGITAL CONTENT MANAGER http://www.SHUTTERSTOCK.COM

Table of Contents for the Digital Edition of ABA Banking Journal - August 2014

Chairman's View
Editor's Column
The Economy
Bank Notes
Picture This
Community Banking
Why HCE could be a big payment plus for banks
Rethinking the branch experience
Social media success not all about "followers"
Compliance Clinic
Around the ABA
Legal Issues
First Person

ABA Banking Journal - August 2014

https://www.nxtbook.com/naylor/BAKS/BAKS0515
https://www.nxtbook.com/naylor/BAKS/BAKS0415
https://www.nxtbook.com/naylor/BAKS/BAKS0315
https://www.nxtbook.com/naylor/BAKS2/BAKS1014
https://www.nxtbook.com/naylor/BAKS2/BAKS0914
https://www.nxtbook.com/naylor/BAKS2/BAKS0814
https://www.nxtbook.com/naylor/BAKS2/BAKS0714
https://www.nxtbook.com/naylor/BAKS2/BAKS0614
https://www.nxtbook.com/naylor/BAKS2/BAKS0514
https://www.nxtbook.com/naylor/BAKS2/BAKS0414
https://www.nxtbook.com/naylor/BAKS2/BAKS0314
https://www.nxtbook.com/naylor/BAKS2/BAKS0214
https://www.nxtbook.com/naylor/BAKS2/BAKS0114
https://www.nxtbook.com/naylor/BAKS2/BAKS1213
https://www.nxtbook.com/naylor/BAKS2/BAKS1113
https://www.nxtbook.com/naylor/BAKS2/BAKS1013
https://www.nxtbook.com/naylor/BAKS2/BAKS0913
https://www.nxtbook.com/naylor/BAKS2/BAKS0813
https://www.nxtbook.com/naylor/BAKS2/BAKS0713
https://www.nxtbook.com/naylor/BAKS2/BAKS0613
https://www.nxtbook.com/naylor/BAKS2/BAKS0513
https://www.nxtbook.com/naylor/BAKS2/BAKS0413
https://www.nxtbook.com/naylor/BAKS2/BAKS0313
https://www.nxtbook.com/naylor/BAKS2/BAKS0213
https://www.nxtbook.com/naylor/BAKS2/BAKS0113
https://www.nxtbook.com/naylor/BAKS2/BAKS1212
https://www.nxtbook.com/naylor/BAKS2/BAKS1112
https://www.nxtbook.com/naylor/BAKS2/BAKS1012
https://www.nxtbook.com/naylor/BAKS2/BAKS0912
https://www.nxtbook.com/naylor/BAKS2/BAKS0712
https://www.nxtbook.com/naylor/BAKS2/BAKS0612
https://www.nxtbook.com/naylor/BAKS2/BAKS0512
https://www.nxtbook.com/naylor/BAKS2/BAKS0412
https://www.nxtbook.com/naylor/BAKS2/BAKS0312
https://www.nxtbook.com/naylor/BAKS2/BAKS0212
https://www.nxtbook.com/naylor/BAKS2/BAKS0112
https://www.nxtbook.com/naylor/BAKS2/BAKS1211
https://www.nxtbook.com/naylor/BAKS2/BAKS1111
https://www.nxtbook.com/naylor/BAKS2/BAKS1011
https://www.nxtbook.com/naylor/BAKS2/BAKS0911
https://www.nxtbook.com/naylor/BAKS2/BAKS0811
https://www.nxtbook.com/naylor/BAKS2/BAKS0711
https://www.nxtbook.com/naylor/BAKS2/BAKS0611
https://www.nxtbook.com/naylor/BAKS2/BAKS0511
https://www.nxtbook.com/naylor/BAKS2/BAKS0411
https://www.nxtbook.com/naylor/BAKS2/BAKS0311
https://www.nxtbook.com/naylor/BAKS2/BAKS0211
https://www.nxtbook.com/naylor/BAKS2/BAKS0111
https://www.nxtbook.com/naylor/BAKS2/BAKS1210
https://www.nxtbook.com/naylor/BAKS2/BAKS1110
https://www.nxtbook.com/naylor/BAKS2/BAKS1010
https://www.nxtbook.com/naylor/BAKS2/BAKS0910
https://www.nxtbook.com/naylor/BAKS2/BAKS0810
https://www.nxtbookmedia.com