Bank Compliance Articles – Banking Risk Column

Articles

Compliance and Risk Management in a Rapidly Transforming Financial World

Written by By Dave Dekkers Head of Product Management – Compliance Products EastNets

About a year ago we saw the first signs of a transformation in the financial world and in the last months the credit crisis has transformed the financial world at an explosive pace.

The change that is occurring is much broader in scope than originally expected. Banks that were considered to be too big to fail or fall are either failing or being taken over by financial institutions that are more financially sound, resulting in a huge paradigm shift in how banks are regarded by the public and other banks. Since banking largely revolves around trust and the ability to service customers, losing a customer and determining the impact of it, should be part of the ongoing risk management of the organization, as well as monitoring the riskiness of existing and new products and the customers using/buying these products. But there are more changes and challenges in the banking world that are threatening banking, as we have known it.

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Selling Compliance as a Service to Your Customer

Written by Dr. Linda Eagle

The USA Patriot Act and Sarbanes-Oxley have forever altered the already complex world of regulatory compliance in banking. However, adhering to these more stringent regulations doesn’t have to conflict with nurturing good customer relations or improving customer retention. Rather, you must present compliance as a service to your customers, and your tellers, platform and call centers must be taught to communicate that message in their daily work. Remember that the main reason customers put their money in banks in the first place is for safekeeping. There are many places to invest money with higher rates of return than banks, but none is as secure. By letting your customer know how and why you are complying with banking regulations, you are selling security.

Nightmare On Compliance Street

Written by Dr. Linda Eagle

It’s bank management’s worst nightmare: An examiner disguised as Joe Customer approaches a teller, and asks about the bank’s policy on sharing personal information or how long the bank holds funds from an out-of-state check. The blank look on the teller’s face reveals all as he struggles to recall the appropriate policies. The resulting penalties to the bank finally rouses the bank manager from his contented slumber like a bad Freddie Kruger moment.

Wave That Flag – But You'd Best Hurry

Written by Tripp Johnson

Wave that flag, wave it wide and high
Summertime done come and gone, my oh my

I'm Uncle Sam, that's who I am
Been hiding out, in a rock and roll band
Shake the hand that shook the hand
Of P. T. Barnum and Charlie Chan
Shine your shoes, light your fuse
Can you use them old U.S. Blues
–Robert Hunter/Jerry Garcia

Can’t you just feel those U.S. Blues, Gonzo Nation? Unfortunately, the flag our industry is waving these days ain’t red, white and blue … it is simply RED! Bankers appear to have come down with a serious case of Red Flag fever, and the impetus for that flag waving is good ol’ Uncle Sam.

Responding to the Compliance Training Needs of Small Banks

Written by Dr. Linda Eagle

bw-examiner In the past ten years, the scope and depth of the laws and regulations imposed on the financial services industry has exploded, placing a heavy burden on smaller institutions that find it increasingly difficult to meet compliance standards. Smaller banks tend to have less fiscal and physical resources to compete with larger banks and therefore struggle to find funding for accurate and efficient compliance training. The problem of teller turnover also exacerbates the situation.