Welcome to part 2 of a 5-part series where we discuss what the agencies want from banks and credit unions regarding vendor management.
This post was originally published on April 10, 2017 at the Ncontracts blog
Third-party risk is a hot button issue for regulators. When a financial institution (FI) outsources an activity to an outside vendor, it can introduce all kinds of risk. Vendor management, or third-party relationship management, is all about identifying, measuring, monitoring and controlling those risks.
Different regulators use different terms to talk about vendor management. While they all ultimately have the same goal, they go about it in different ways. Today we’re looking at the OCC’s approach to vendor management to better understand what the agency really wants from FIs.
The OCC views the failure to “engage in a robust analytics process” for vendor management as potentially “an unsafe and unsound banking practice,” according to OCC Bulletin 2013-29 – Third Party Relationships. Naturally risk-averse, the agency...
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