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The future of third party risk management Sibos \ Singapore \ October 2015 The Science of Finance
The future of third party risk managementSibos \ Singapore \ October 2015
The Science of Finance
\ 2
Increased reliance on third parties
Accounting
Outsourcing providers
Exchanges
BPO providers Infrastructure and
cloud providers
Consultants
Real estate and facilities
Pricing and valuation data
Ratings agencies
Custodians
Prime brokers
Clearinghouses
Law firms
Hardware and software vendors
\ 3
Increased complexity of oversight
As the number, nature and complexity of third party relationships expand…
The cost and challenge of oversight increases.
\ 4
Increased focus by regulators
Monetary Authority of Singapore (MAS)
L'Autorité des Marchés Financiers (AMF)
Prudential Regulation Authority (PRA)
Germany (BaFin)
Canada Office of the Superintendent of Financial Institutions (OSFI)
Australian Prudential Regulation Authority (APRA)
Hong Kong Monetary Authority (HKMA)US (OCC, SEC,
FINRA, FDIC, FRB, FFIEC, NCUA, and FinCEN)
Japan Securities and Exchange Surveillance Commission (SESC)
\ 5
Current processes are not keeping pace
Duplicative, bilateral and costly
\ 6
Processes are outdated
\ 7
The third party risk management challenge
So how can the quality of third party risk management keep pace with the level of risk and complexity of these relationships?
\ 8
The current state of third party risk management
Planning
Due diligence
Contract negotiation
Ongoing monitoring
TerminationCONSUMER
(Bank, Asset Manager, etc)
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V2
V3
V4
V[n]
4th party
vendor
4th party
vendor
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The future state of third party risk management
CONSUMER(Bank, Asset Manager, etc)
V1
V2
4th party
vendor
V[n]
Know Your Third Party
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The future of third party risk management
Thank youFor more information, please contact
Gina GhentMD, head of KY3P™, Markit
mines datapools intelligencesurfaces informationenables transparencybuilds platformsprovides accessscales volumeextends networks& transforms business.
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