Lending

The buzz at ABA Risk and Compliance 2023

Prodigal's Scott Hamilton with a festively dressed friend

Last week we were back in Texas, this time in San Antonio, where we got to try puffy tacos and hang out with the locals.

In between all that delightful foolishness, we talked to everyone we could at the ABA Risk and Compliance conference about what was on their minds.

Rising regulatory oversight

Everyone’s been talking about increased oversight since March, but we’re still not sure what that will look like at any level.

The New York Timesrecent profile of Western Alliance touched on the uncertainty regional and small banks are facing as regulators debate, and we heard those same topics echoed at ABA last week.

There was also quite a bit of discussion about the bipartisan Senate bill to seize failed banks’ executive pay and a potential increase in capital requirements

But there was a lot of buzz about fintechs and opportunities for partnership, which reminded us of this op-ed from American Banker about considering regulatory sandboxes instead of cracking down harder.

Lots of food for thought. Not as tasty as puffy tacos, but food for thought nonetheless.

Complaints, complaints, complaints

Speaking of regulations, customer complaints, more specifically, complete and accurate complaint capture, is a top regulatory focus, so we were in lots of conversations about this last week.

Here’s the problem: many banks are leaning, often exclusively, on their frontline agents to identify and document complaints. They’ve had to, because technology that relied on old-school transcription and keyword searches delivered too many false positives and negatives.

Last week we heard so many people in banking who would love an automated solution to solve this large cost, risk, and revenue challenge. 

Guess what?

Finally (finally!) consumer finance-trained AI is here to deliver the answer banks have spent millions of dollars looking for a solution to. 

Learn more here.

Image by snowing on Freepik of hand stopping dominos from falling

Staffing issues

Banks have been struggling with staffing like everyone else. 

But what we heard last week was an interesting shift. Headcount may be dropping or staying steady, but within the risk and compliance departments, the situation is different.

As the bar for robust risk and compliance management programs gets raised, the need for experienced talent that understands how the bank operates is heating up.

Obviously we were talking to a bunch of risk and compliance folks at the risk and compliance conference, so this was top of mind for them, but it’s a real issue.

And it’s not just on the banking side - we know staffing shortages at the Fed and FDIC contributed to a lack of proper oversight that played a role in the banking collapses earlier this year.

We really enjoyed the conversations we had with everyone at ABA Risk and Compliance, and we’re looking forward to talking to more banking teams about how we can support complaints management systems and other compliance needs.