Staffing struggles in the banking industry come at a time when compliance risk remains heightened “as banks navigate the current operational environment, regulatory changes, and policy initiatives,” the OCC stated.
“A lack of access to subject-matter expertise may result in increased compliance and operational risks, particularly if existing compliance processes, controls, testing, and training become subject to funding cutbacks or limitations, or if future compliance management program enhancements and maintenance are delayed,” the OCC stated in its report.
Compliance and operational risk may increase or evolve if banks begin using, or expand their current use of, third parties to support or fill critical compliance roles, “especially if banks do not conduct appropriate due diligence on third parties or select inexperienced or unqualified third parties,” the OCC warned. “Such risk also may increase if banks expand the use of telework either to remain competitive or retain employees; or if they hire from different geographical areas to fill openings.”
Operational risks
The OCC report also discussed elevated operational risks due to evolving cyberattacks. To mitigate cyber risk, banks should “maintain heightened threat and vulnerability monitoring processes and implement more stringent security measures, including the use of multifactor authentication, hardening of systems configurations, and timely patch management,” the OCC advised in its report. “Banks should also consider how to effectively implement, regularly test, and isolate system backups from network connections to provide operational resilience.”
Cyberattacks are also increasingly threatening global supply chains. “These attacks demonstrate the importance of banks assessing the risks emanating from their third parties, inclusive of the supply chain, and developing a comprehensive approach to operational resilience,” the OCC stated.
Climate-related risks
The OCC report also discussed climate-related financial risks facing banks. The OCC said it “views climate-related financial risks as raising significant risk management issues due to their impact on bank safety and soundness and financial stability,” and that it will “continue to monitor the development of climate-related financial risk management frameworks at large banks.”
As banks’ climate-related financial risk management practices continue to evolve, with many still being in their early stages, “bank management should continue to ensure that their public statements about their institutions’ climate risk management efforts are consistent with their institutions’ actions,” the OCC stated. “OCC supervisory activities at these large banks will focus on safety and soundness considerations and integration of climate-related financial risk into bank risk management frameworks.” 
Jaclyn Jaeger is a contributing editor at Compliance Chief 360° and a freelance business writer based in Manchester, New Hampshire.
The minute they start understanding that compliance is risk based and not a legal desciple. They’ll get the good candidate
What’s the point of asking where do I see me in five years. How’s that going to assist in determining if I fully understand risk based Approach and I hold a qualification in compliance. The expectations of finding someone who knows all the acts applicable to their industry by heart is ridiculous.
Wish them luck with this aforesaid approach.
I’m a compliance professional who’s been struggling to find work in my field of compliance for the last 4 years. I’m willing to migrate if need be. Whatever bank is looking I’m willing to work for.
I have some great friends who are looking for work and are great compliance hires. Write me on linked in
Banks should take on candidates that have the academic qualifications and train them to get the work experience, I have the highest qualification in compliance in Uk but I have not been able to get a job in entry level role due to experience.
If banks were truly committed to filling their open compliance reps then they would be filled. The market is active with capable and qualified compliance professionals. I am one of them. I’ve been passionately searching for a full-time financial crimes role since January with lackluster results. I have 2 certifications, sit on a compliance board and have 17 years of experience to leverage in any role. It’s frustrating when articles like this pop up.