Punitive fines, litigation settlements, customer remediation, and other costs flowing from non-financial risk management failures are often waived off as “costs of doing business.” But many are now prioritizing the development of reliable metrics that would offer disclosable leading indicators of these financial risks so that they may be addressed proactively.
Observations
Apr 23, 2024In a blog post published last week, Federal Reserve Bank of New York researchers Beverly Hirtle and Anna Kovner explore the impact of supervision on banks, the financial system, and the economy.
Compendium
Jun 07, 2023Compendium
Jun 07, 2023“Supervisors in other jurisdictions have adopted approaches based in behavioral science that incorporate data on institutional attitudes and norms related to risk factors, such as complacency, overconfidence, short-term focus, and lack of effective challenge that can reveal institutional blind spots and contribute to vulnerabilities like those seen at SVB,” Fed’s Vice Governor for Supervision Michael Barr noted in his April report to Congress on the collapse of SVB.
Compendium
Jun 07, 2023
