Advantages of Risk Management Software
No bank wants to fall victim to a data breach or similar issue where customer information falls into the wrong hands. Additionally, all risk and compliance problems need to be eliminated as soon as possible, if not prevented from even occurring in the first place.
By investing in comprehensive risk management software, financial institutions can avoid expensive and time-consuming recovery processes. When organizations understand where their weaknesses are, and make every effort to amend them, it will pay off in the long-run.
Otherwise, smaller banks could find themselves following in J.P. Morgan Chase’s footsteps. The Wall Street Journal recently highlighted the firm’s regulatory and legal issues, highlighting how it needs to pay $4 billion and commit 5,000 extra employees this year to clean up its risk and compliance problems.
“Fixing our controls issues is job No. 1,” CEO James Dimon told the Journal. “This is a huge investment of people, time and money…but it will make us stronger in the long run.”
Additionally, there will be a 30 percent increase of risk-control staffing, the news source said.
Jason Goldberg, an analyst at Barclays Bank, explained to the Journal that while these are expensive times for J.P. Morgan, many of the issues are building to a “crescendo.”
According to a contribution piece in Bank Systems and Technology, the large company never should have gotten to this level. The article said that investments in risk management and regulatory compliance need to be made as early as possible and are strategic business moves. Rather than fixing problems, organizations can keep themselves ahead of the curve and will provide opportunities to leverage investments to advance market, growth and competitive strategies.
Having current risk assessment software is an essential tool for financial organizations of all sizes to achieve this goal.
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