Raising the bar for risk management: Benchmarking risk management practices in banking in EMEAI
TPG’s inaugural benchmarking survey of risk management in the banking industry examines how the economic crisis has influenced the way financial institutions manage and think about risk. In particular, the survey of 78 banks across Europe, Middle East, Africa and India explores how and to what extent banks have embedded risk management into their strategies, operations and behaviour.
Key findings
- While the banks believe they have robust risk structures and strategies, they realise that risk management should play a stronger role in the business planning and management of their organisations
- Risk management is still viewed from the risk function perspective rather than being integral to broader business processes, operations and behaviour of the organisation
- Banks’ view of their exposures is still incomplete as they struggle with poor data quality and the siloed way risk is monitored and managed
- To instil a strong risk management culture and driver the right behaviours throughout the organisation, banks need to fully integrate risk measures into performance management
- Banks have adjusted their risk models following the crisis. However, reviewing the models and validating underlying assumptions is yet to be determined
- To succeed in the new environment of new and increased regulatory demands, banks need to ensure risk management is a key consideration for all risk takers and decision makers. A paradigm shift to the way risk management is perceived ― from compliance to competitive edge.
Please contact us if you would like our team to benchmark your risk management function.