The recently published OCC Risk Management Guidance and Federal Reserve Guidance on Managing Outsourcing Risk renew and enhance the management of potential risks arising from the use of third party service providers. Collectively, these recent publications provide detailed guidance on the holistic risk management processes banks should adopt to mitigate third party risks. While this alert focuses on the guidance promulgated by the OCC, it also should be instructive for financial institutions other than national banks and may set the gold standard for third party risk management, the Board of Directors’ role in such management, and the evaluation of fourth party risks in other industries, regulated or not.

Contributors: Baker & McKenzie
Categories: Whitepaper
SRC Type: Risk Management, Risk Management Outsourcing (RMO), Sourcing Management, Third Party Management