Survey: U.S. bank failures prompt reassessment of third-party risks
The recent banking crisis—in which three mid-sized U.S. banks failed—prompted just under half of compliance professionals across all industries to reassess their third-party risk management (TPRM) procedures, according to a recent survey conducted by Compliance Week and integrated risk management software provider Riskonnect.
The survey, which compiled 118 responses between April and May, found 45 percent of respondents changed or considered changing their procedures regarding third parties following the banking industry turmoil that began with the collapse of Silicon Valley Bank on March 10. Signature Bank and First Republic Bank would later also fail in the United States.
The ramifications of these collapses affected more than just the banking industry. Some real-life companies reported difficulties making payroll because key third parties—say, a payroll management vendor—were affected by the turmoil.
According to the survey, 63 percent of respondents said their third-party monitoring system would not have detected such a red flag.