A new survey from ProSight Financial Association has found that cybersecurity remains a top priority for chief risk officers in the coming year.
In its fourth annual RMA Chief Risk Officer Outlook Survey, ProSight found rick officials had been affected by the 2023 regional bank crisis as critical risks and that cyber, fraud, and third-party risks remain. Conducted over the summer of 2024, the RMA CRO Outlook Survey polled 177 CROs and other senior risk leaders from U.S. and Canadian banks. Cyber risks topped the list, with 63 percent of respondents naming it a top-tier risk, followed by fraud (44 percent) and technology risk (38 percent) coming in third. Wholesale credit risk (32 percent) and third-party risk (32 percent) rounded out the top five.
“This year’s survey and its aggregation of the most prevalent risk priorities and practices will help risk officers manage these challenges head-on, especially in areas of growing concern like cyber and fraud,” Edward J. DeMarco Jr., managing director of Advanced Risk Services at ProSight Financial Association, said.
The survey also found that 93 percent of the respondents noted a need to adapt to the increased speed of risk because of bank stock volatility, unprecedented deposit runs, and other developments that came out of the regional bank crisis in 2023. CROs said their institutions are implementing early warning indicators and risk limits, as well as enhanced scenario analysis, crisis management and incident response plans based on data from that crisis.
“This year’s survey highlights that many of the impacts from the 2023 regional banking crisis are here to stay. Risks are materializing faster as the world becomes more interconnected, with cyber, technology, and third-party risks continuing to rise in importance,” said Michael Duane, Partner and Co-Head of the Americas Finance and Risk Practice at Oliver Wyman.
Additionally, 84 percent of the respondents said their institutions are being held to higher standards by supervisory teams and that they expect that trend to continue. Many told surveyors that regulators have higher expectations for faster response to questions and progress on open issues.