Timely Risk Data
I’ll give you some examples of what is happening in some banks. I talked to a risk officer about a year and a half ago. He described his scenario where he would go into a risk committee meeting on a quarterly basis, and he would compile risk reports and metrics right before that meeting. Come to find out that the data he’s presenting is maybe two or three months old, and in some cases, maybe four or five months old.
When you look at Covid, things change within a matter of months if not weeks, so many banks are asking how do we get quicker and more real-time in bringing that data in? That has been a trend that we have seen over the last year.
Identifying Risk Trends with Internal and External Data
Capturing KRIs and using that to detect problem areas – that is where people are at today. We are looking at how AI can help improve that. How do you not just look at that data, how do you see trends? You may look at a number of complaints and KRI data may still be within your threshold, but if you combine that with the trend of the complaints, you can detect that this is going up. That may be a problem area. You can then go out and combine that with regulatory insights, such as enforcement actions. Where are the enforcement actions and the fines coming from? What is in a particular regulation? Use that data to compare what your organization is doing. That can help predict Is this an area that we may want to explore? While we think we have a low risk, this is a big issue for the industry, and we need to make sure we’re involved with that. Read more: https://bit.ly/3sxmo7l