How Banks Are Managing Risks During the Pandemic

July 14th, 2023

This has been a challenging year for the finance industry. Financial establishments, such as banks, were forced to alter business procedures and operations with urgent immediacy when the crisis gained momentum. To do this meant a rise in uncertainty, as banks were forced to accept more risks.

Operational risk is associated with a failure in the operations of a financial institution, and can be traced back to failed or inadequate processes, management, or employees, or losses due to fraud or system failures. When wellness became a priority, banks had a sudden shift to a remote workforce, and operational resilience relied heavily on technology. Digital transformations which were originally planned to take several years happened in several weeks. This includes the launch of online banking capabilities so customers can manage account activities remotely. The adaptation of an omni-channel presence required banks to train staff in new capabilities, be they at the branch office, call center or operate online. Online work proficiency includes cybersecurity and cyber-hygiene. Banks have always been aware of security risks, and with the sudden shift to digital channels, hackers, identity fraud, and phishing emails will remain a concern.

Operational risk also includes transparency between banks and employees, and employees and customers. As remote work continues, bank leaders worry about the erosion of company culture. Things have panned out well so far due to the relationships banks had prior to the crisis; but moving forward, banks will need to find ways to form and reinforce new relationships, not only in the workforce but also with customers. Regularly surveying employees for feedback and recognizing trends in customer care will help banks reconsider management styles to prevent feelings of isolation and streamline daily processes.

Compliance risk is related to those legal penalties a bank faces should it fail to follow the regulatory standards put down by the industry. New operating procedures and customized banking services can put banks under scrutiny. During and after the crisis, banks must check with proper legal counsel to ensure company changes are in compliance with industry terms but also satisfy client needs in a fair, ethical manner.

Credit risk is the potential for borrowers to default on their obligation to a bank. This is the most significant risk banks face, and if the economy enters a recession, there will be a surge of debt defaults. Many companies and customers will be unable to pay back their loans, and banks will suffer huge losses. This, of course, is a financial risk. Bank support for customers during the crisis has taken many forms, including easing the policies for collections on negative balances, deferred payments, and overdraft fees. Concerns rise though as more customers ask for credit, and banks are forced to be more lenient in how they define financial hardship. Some of the world’s largest banks have prepared for worst-case losses by setting aside substantial reserves in loan loss provisions. Smaller banks, however, are unable to take such preventive measures and may not fare well if conditions worsen.

While mechanisms are in place to manage risk, and thus minimize the negative effects risks can have on the productivity, financial health and overall reputation of an institution, it has taken a great deal of effort by global financial leaders to navigate the ups and downs of the crisis and still serve customers. Risks can cripple a business, and while institutions have done well so far to monitor risks under pressure, it is necessary that risk models plan for a long-term duration of the crisis, since its end is nowhere in sight..

Managing Banking Employees Remotely

July 12th, 2023

2020 has spurred a series of changes, most notably the decision by thousands of businesses to manage employees and coordinate operations remotely. The banking industry is no exception. New priorities have forced banks to very quickly adjust to a remote world, where much of their workforce stays home. This was a shift a lot of financial institutions were ill-prepared for, but most have adopted new procedures and best practices to counteract issues with logistics and security.

Employees no longer operate within sight of the bank offices, so banks keep operations insight through technology. Company-issued devices with special protections, such as multifactor authentication, are mandatory. These devices, secured with corporate malware protections and local firewalls, stave off most security incidents. Many banks also use a virtual private network (VPN), which keeps data on a server back at the organization; employees can log in and out of the VPN, but nothing remains on their device.

To further protect bank security and client lists, it is necessary for institutions to educate and train their employees on the use of bank-owned and managed hardware and heightened threats, such as phishing emails and fraud scams. Password security and cyber-hygiene are also important. Some banks employ monitoring tech, which allows them to track and visually monitor employee activity on bank-issued devices. With this comes the need for a remote work policy that outlines for employees the processes and tools needed to do their jobs, as well as the objectives, communication frequency, and transparency of their work.

Traditional banking was for the longest time a physical, in-person platform. In recent years, banks and other lending institutions automated complex tasks, like account openings, loan applications, and money transfers. This year, however, has seen customers flock to digital channels to perform their banking activities, and any bank that did not offer online means before must now hurry to automate capabilities. As a result, employees must be trained and familiarized with the newly automated systems and workflows, so they can handle complex interactions virtually instead of in the office. This, in turn, can create new, trackable actions that help measure productivity.

Managing a remote workforce has other challenges. Supervisors must navigate team responsibilities, identify roadblocks, and keep an open line of communication in a virtual environment. To keep members accountable, banks will likely use more project-oriented performance management approaches. Performance will be managed based on how well a team (or individual) meets project deadlines and expectations, not on their attendance in the office.

It does not appear that remote work is going away anytime soon, but recent studies show remote workers have higher job satisfaction. They have fewer distractions and a greater ability to focus than if they were back at the office. They achieve a work-life balance that was not realized before, and companies see a boost in productivity. For this reason, many banks are reconsidering operations. JPMorgan Chase, for instance, has employees on a rotational schedule. Depending on the type of business, they may work from home two days a week, or one to two weeks a month. Some portions of their workforce may stay remote permanently.

Until conditions improve and the wellness of staff and clients is no longer a guessing game, banks will continue to navigate the challenges of a remote world. Many seem to be doing well at this, investing in software vendors, testing AI, and reconstructing work policies and ethics. It may be, when conditions improve, some banks will be ahead of the industry game and more progressive than ever before.

How To Begin Preparing Your Professional Resume

July 10th, 2023

When you begin the resume process, you want to make sure it is professional looking.  Sloppy or disjointed resumes will usually get immediately passed on by the reader.

Before you start writing your resume, you should make sure that you have a professional email address like, rather than After you update your email address, you will want to make sure that you correctly update your personal information like your phone number and address.  You will also want to make sure that you do not put in your marital status, date of birth or photograph.

One of the biggest mistakes often made is showing your address in an area far from your current listed employer.  In doing this you may give the impression that you are working remotely.  So, if you have recently moved please be sure your last employer information shows you have left.

Next month we discuss the proper formatting of your resume to get the attention of the reader.