Financial institutions face an increasing number of industry risks—making it more and more important for executives to identify and address potential threats before they negatively impact their business.
The 2018 Risk Survey—presented by Bank Director and Moss Adams—includes insights from directors, chief executive officers, and senior executives of US banks with more than $250 million in assets.
According to the survey, the concerns of top executives often align with key priorities identified by banking regulators: cybersecurity, compliance, and strategic risk.
Here's a look at some of the 2018 Risk Survey's findings, according to Bank Director.
Summary of Findings
- Cybersecurity is a top risk concern for 84% of executives and directors, followed by compliance risk (49%) and strategic risk (38%).
- Respondents report that banks budgeted a median of $200,000 for cybersecurity expenses, including investments in personnel and technology.
- Of the respondents, 71% say their bank employs a full-time chief information security officer.
- An adequate level of in-house cybersecurity expertise is present for 69% of respondents.
- All respondents say their bank has an incident-response plan in place to address a cyberincident, but 37% are unsure if that plan is effective. Sixty-nine percent say the bank conducted a table-top exercise—essentially, a simulated cyberattack—in 2017.
- If the Federal Reserve's Federal Open Market Committee raises interest rates significantly—defined in the survey as a rise of one to three points—45% expect to lose some deposits, but they don't believe this will significantly affect the bank.
- If rates rise significantly, 45% say their bank will be able to reprice between 25 and 50% of the loan portfolio. Twenty-eight percent indicate that the bank will be able to reprice less than 25% of its loan portfolio.
- One quarter of respondents are concerned that the bank's loan portfolio is overly concentrated in certain types of loans, with 71% of those respondents concerned about commercial real estate concentrations.
View the media tiles below to see the full results of the complimentary survey and gain additional insight from Moss Adams Partner Craig Sanders.