Risk Management

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FSR advocates for the development of robust risk management practices that protect the financial and reputational strength of financial institutions, their customers, and the financial system. Risk management priorities cover insurance industry, systemic risk, prudential risk, and enterprise risk issues.

Policy discussions in this area are continually informed though input for executives that serve on the FSR Risk Management Policy Committee as well as the FSR Chief Risk Officers Council.

Current Risk Management Priorities:

  • Cybersecurity
  • Federal Government Involvement in Insurance Regulation
  • Reauthorization of the National Flood Insurance Program
  • Capital Planning & Stress Testing Requirements
  • Resolution and Recovery Plan Requirements
  • The Designation Process of the Financial Stability Oversight Council
  • Patents and Intellectual Property
  • Capital Standards for Financial Entities (Bank & Non-Bank)
  • Bankruptcy Reform and “Too Big to Fail” Issues
  • Swaps & Derivatives

OCC D-FAST Information Collection Requirements

February 18, 2017

FSR urges the OCC to harmonize its information collection requirements with the Federal Reserve with respect to the information banks must submit as part the annual Dodd-Frank Act Stress Test (D-FAST). FSR notes that harmonization will help improve data quality. FSR also asks that banks be given at least six months to adapt to other changes proposed by the OCC.

FSR’s 2017 Priorities

February 9, 2017

  Modernizing Financial Regulation to Create Opportunity and Grow the Economy FSR supports a financial regulatory system effectively tailored to […]


Requirements for Accepting Private Flood Insurance Policies

January 13, 2017

n its response to a joint-proposal from five federal agencies on when lenders may accept private flood insurance policies (the Federal Reserve, OCC, FDIC, NCUA, and Farm Credit Administration), FSR noted that the proposal’s requirements will likely stifle the ability of insurers to create a vibrant private-sector market for flood insurance coverage. The letter notes that neither lenders or insurers are in a position to verify that the coverage provided in a private flood insurance policy meets the provisions of what is covered in polices offered by the federal government. To help encourage the development of a the private market, FSR suggests that regulators allow lenders to have the discretion to accept private flood insurance policies that are comparable to policies offered by the Federal Government and offered by highly rated insurers. FSR also supports efforts to create more permissive standards in offering flood insurance on commercial properties.


Joint-Trade Comment on CFTC Cross-Border Proposal

January 3, 2017

FSR and six other financial trade associations express their concern with a proposal by the Commodity Futures Trading Commission (CFTC) to register and regulate entities defined as “Foreign Consolidated Subsidiaries.” As the letter notes, these entities are already subject to the prudential rules of the foreign jurisdiction in which they reside. As a result, the CFTC proposal will result in duplicative regulation would hurt the ability of U.S. based financial institutions and commercial end-users to compete internationally.


Shortened Settlement Cycle for Securities Transactions

January 3, 2017

FSR supports efforts by the Securities and Exchange Commission to reduce the time that securities transactions are settled from three to two days. The proposed change will have a positive impact on systemic risk. FSR does note, however, that the proposed changes will also have impacts on other SEC settlement rules and asks that the SEC allow some amount of leniency as the securities industry and the industry adapt to the new regime.


Letter to FINRA on Mitigating Financial Exploitation

January 3, 2017

FSR expresses its support for a proposal by FINRA that would allow broker-dealers to withhold distributions from the account of vulnerable adults when there is reasonable evidence of financial exploitation. FSR believes covered firms should be given twelve months to conform to the new standards, and that certain clarifications should be added to forms that firms must complete when they report suspicious behavior.

Amendments to Federal Reserve Capital Planning and Stress Testing Rules

January 3, 2017

FSR supports the Federal Reserve’s proposal to no longer use qualitative criteria as the basis for objecting the annual capital plans of so-called “large and noncomplex” institutions. FSR members, however, do request that the Federal Reserve provide more information on the supervisory processes and documentation requirements for assessing the capital planning processes of institutions that are no longer part of the qualitative portion of the annual Comprehensive Capital Adequacy and Review (CCAR) exercise. The letter also contains some suggested changes to the FR Y-14 information collections related to CCAR that are in keeping with the Federal Reserve’s stated desire to reduce unnecessary burdens on financial institutions that are covered by CCAR. FSR also supports the CCAR transition timeline proposed by the Federal Reserve. It also asks that the Federal Reserve continue to allow de minimis capital distributions according to its current policy. This letter was also signed by the American Bankers Association.