Regulatory compliance and risk concerns remain high in a number of key areas for U.S. banks and credit unions, according to the results of Wolters Kluwer’s 2020 Regulatory & Risk Management Indicator survey. This year’s survey, conducted by Wolters Kluwer’s Compliance Solutions business, generated a Main Indicator Score of 103, an eight-point increase over the 2019 score. This was influenced by concerns about managing regulatory change, mortgage-related regulations, and U.S. Coronavirus Aid, Relief, and Economic Security (CARES) Act requirements.
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The COVID-19 pandemic weighed heavily on respondents’ minds: 86 percent view the pandemic as a significant or moderate factor in their organizations’ enterprise risk planning. Other areas of high concern include loan default risk (85 percent), business resilience and adaptability (79 percent), and recession fears (78 percent).
“Relatively high levels of concern remain across a range of areas, reinforcing the fact that regulatory compliance and risk management issues continue to significantly challenge financial institutions,” said Timothy R. Burniston, Senior Advisor for Regulatory Strategy with Wolters Kluwer Compliance Solutions. “That said, respondents expressed their highest levels of confidence in the past four years regarding their organizations’ ability to manage risk across all business lines.”
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Burniston will share insights on this year’s Indicator survey findings in a webinar, “Annual Survey Results Signal Direction for Banking Industry,” 2-3 p.m. EST Wednesday, Dec. 16, along with Wolters Kluwer Senior Specialized Consultant Elaine Duffus and Steven D’Alfonso, Research Director, IDC Financial Insights.
The calculation of the Main Indicator Score is based on several factors, including the number of new federal regulations, number of enforcement actions, and the total dollar amount of fines imposed on banks and credit unions over the past 12 months, together with additional information provided by survey respondents. The survey was conducted nationwide between August 4 and September 3, 2020 and generated 665 responses.
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