The Federal Reserve Board (FRB) and the Office of the Comptroller of the Currency (OCC) have both released new guidance on management of third-party risk. The boards of directors and officers of all financial institutions, regardless of whether regulated by the FRB or the OCC, should carefully consider the sufficiency of their institutions’ systems for overseeing outsourced activities in light of these new guidance documents. Both guidance documents emphasize that the board and senior management are responsible for establishing and overseeing a risk-based system for managing relationships with third-party vendors.
The FRB’s guidance applies to bank holding companies and member banks, and the OCC’s guidance applies to national banks and thrifts. But both guidance documents provide an essential road map to regulators’ expectations, and underscore the continuing the regulators’ continuing emphasis on oversight of outsourced activities.
For more information, please contact our banking group or call 208.344.6000.