Learn three essential trends shaping the compliance industry we've discovered after speaking with industry pros, compliance officers, lobbyists and regulators! These three key takeaways are important for every banking compliance professional to consider as they move forward in a rapidly changing regulatory environment.
It’s been one week since the ABA’s annual Regulatory Compliance Conference in New Orleans, and what a wonderful conference it was. We’ve now had some time to process, reflect, and internalize some of those lessons learned, and we're excited to share them with you!
If you were with us in New Orleans, we’d love to know what you think of these 10 takeaways. Do they align with what you experienced? Even if you didn’t attend, we’d still be very interested in hearing from you about how these trends relate to your role. Please leave your thoughts in the comments section below!
Throughout the conference, we heard compliance professionals and speakers discussing the changing role of compliance in financial institutions nationwide. In general, it appears that compliance professionals are taking on a more strategic and integrated role in their financial institutions.
The incredible Patti Blenden, CRCM, gave a smart and savvy presentation about the tools compliance professionals need to be successful in a changing environment. One of her main points was that, no matter how much the regulations change, you will need the same skills to navigate them. These skills – including persistence, positivity, pluckiness, and preparedness – are absolutely necessary for you to continue to manage the challenges of your role.
Other sessions, such as “Next Gen Compliance Management Systems: This Ain’t Your Grandma’s CMS,” discussed how compliance professionals’ mindsets must evolve as the approach to compliance also changes.
It was also interesting to hear from compliance experts that, even with deregulation in some areas, compliance remains a priority for the agencies and financial institutions. In this ecosystem, more and more financial institutions appear to be evaluating compliance less as a cost center, and more as a valuable safety resource in their growth planning.
As mentioned above, this changing compliance role is also reflected in the new approach to compliance management. We’ll discuss that changing approach next.
Related: 7 Tips for How to Respond to Bad Compliance Exam Results
There were a few different sessions on the changing approach to compliance risk management at the #ABARCC19. Many of these focused on your Compliance Management System, or CMS.
According to the FDIC Examination Manual, your CMS is how your institution:
In the “Ain’t Your Grandma’s CMS” session mentioned above, the following key takeaways were presented:
However, this was certainly not the only session dealing with CMS strategies and change management. A central concept in these sessions is the Third Line of Defense.
The Third Line of Defense framework is a new way of conceptualizing your CMS. The three lines of defense are:
The Three Lines of Defense are important for ensuring that your institution has a healthy culture of compliance and efficient, streamlined risk management approach.
Implementing a successful CMS with three lines of defense can be challenging and frustrating. (That became very clear in speaking with the bankers during the ABA RCC.) However, there are certainly ways to make it easier and more palatable for everyone. One tip: focus on risk exposure, and start where that exposure is the greatest. That way, it’s easier for all employees to understand why the three lines of defense truly matter.
We’ll be spending a lot more time talking about CMS strategies and the third-line of defense in future posts. If this is of interest to you, please let us know!
Now that TRUPOINT and Ncontracts joined forces, there are a plethora of ways that we can serve you. From Fair Lending analysis software to a brand-new CMS tool, we have the solutions you need to ensure compliance success.
[News Alert: Ncontracts just released a new CMS tool, called Ncomply! Read the press release here.]
We weren’t necessarily expecting to focus so much on Fair Lending compliance during this ABA RCC, but looking back, it seems somehow inevitable. Many of the sessions dealt with Fair Lending compliance, directly or indirectly.
Below are a few of the super-hot compliance topics that related back to Fair Lending. To keep this short and sweet, we’ve provided updates in bullet points:
And those are just a few that spring to mind. We could spend an entire blog post on each of the above topics – and we still might!
An important takeaway is that, even though Fair Lending enforcement has seemed quiet in 2017 and 2018, that may change in 2019 and beyond. We’ve already seen two Fair Lending-related actions this year:
(We’ll be writing more about those in the future).
Remember that we specialize in Fair Lending, HMDA, CRA, and UDAAP compliance. Even as HMDA data undergoes changes, it is absolutely essential to know your Fair Lending and Redlining risk! With Fair Lending Analytics and Redlining Analytics, our compliance analysis software, we can help.
Fair Lending was certainly not the only area seeing major changes. There were a lot of regulatory hot topics discussed at this conference. Some of the hottest topics discussed were:
We also will be doing deeper dives into each of these areas in the coming weeks. Keep your eyes open for those posts!
Tell us what you think of these major trends and changes in the comments below! We had a ball spending time with you all in New Orleans, and are so grateful to have the chance to serve you.
Discover even more about Regulatory Compliance Management Systems, including why your FI needs one!