The Office of the Comptroller of the Currency has issued a notice of proposed rulemaking that establishes standards for the risk governance frameworks at national banks, federal savings associations, and federal branches of foreign banks, with consolidated assets of $50 billion or more. It requires boards to oversee the framework’s implementation, challenge management when needed, and have at least two directors who are independent and free of potential conflicts of interest.
The proposal addresses roles and responsibilities for independent risk management and internal audit at covered banks as they establish risk controls. “These units should also ensure that the board has sufficient information on a covered bank’s risk profile and risk management practices to provide credible challenges to management’s recommendations and decisions when appropriate,” it says.
