Free Webinar: The State of Sanctions
Thursday, June 8th - 1:00 PM CT
The sanctions landscape is evolving - exposing institutions to greater sanctions risks, operational and oversight challenges, and obligations to comply with sanctions administered by OFAC and other agencies. OFAC expert, Tim White, will address these issues and what you need to be aware of moving forward. (Register here.)
OCC adds sales practices to financial institutions risks
The OCC has released its Semiannual Risk Perspective for Fall 2016. which reports on the strategic, credit, operational, and compliance risks facing national banks and federal savings associations. The report includes an added focus on sales oversight, in the aftermath of the Wells Fargo scandal. Other highlights of the report include:
- Strategic risk remains high as banks consider business model changes and face challenges in growing revenue. Strategic planning remains important as banks adopt innovative products, services, and processes in response to the evolving demands for financial services and the entrance of new competitors, such as out-of-market banks and financial technology firms.
- Banks continue to ease underwriting practices to boost loan volume and to respond to competition from bank and non-bank lenders. These actions are evident in commercial, commercial real estate and auto lending. The level of risk is increasing due to increased risk layering, rising loan policy exceptions, increasing loan-to-value ratios, and weaker covenant protection.
- Operational risk remains a concern as banks face changing cybersecurity threats, increased reliance on third-party relationships, and the need for sound governance over sales practices.
- Banks face challenges meeting the integrated mortgage disclosure requirements and amended Military Lending Act regulatory requirements, and managing Bank Secrecy Act risks.
Comptroller Curry offered remarks during the press call on the report.