Bob Roth

Community Leader

A New Mandate at a Heavy Cost

Despite all of the regulation, internal and external audit functions, credit risk policies and unlimited paperwork tracking our adherence to safety and soundness, the banking industry was unable to effectively avoid or manage its way through a crisis. The only rational conclusion from bankers can be that risk management is broken and needs to be fixed.

It's not just about regulatory compliance or paperwork – it’s about integrating a risk management culture into every bank operating process.

To build effective and efficient ERM capabilities, banks need to have a clear organizational strategy for risk management, as well as the systems and processes to make sure practices are consistent and less labor-intensive. A key element of best practice ERM will be the creation of risk dashboards that help banks effectively monitor risk exposures, critical exceptions and mitigation efforts.