Re-evaluating risk and control models

1LoD held a series of private meetings with senior risk and control professionals in the US to discuss the most pressing issues in non-financial risk management following several recent bank failures.

Key takeaways
• The 1st line – not the 1.5 or 2nd line – must accept risk ownership and accountability
• Current market events demonstrate the value of strong non-financial risk management
• There are no boundaries between financial and non financial risk anymore
• Regimented, periodic risk assessments need to be supplemented by agile table-top reviews
• The business owns risk and responsibility – but this is seldom recognised in banking culture
• The trend is for 2nd line staff to move to the 1st line
• The need for control automation is driving demand for better technology and for staff with the skills to implement and use it
• Expect greater regulatory scrutiny across the board in the wake of the banking turmoil

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