Federal regulators solicit comment on new third-party risk guidance
Banks, credit unions and Fed-supervised community banks must comment within 60 days of the Federal Register notice.
The Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System, the National Credit Union Administration and the Office of the Comptroller of the Currency jointly announced a request for public comment on proposed guidance intended to assist financial institutions in managing risks associated with third-party relationships.
The draft guidance reflects the agencies' supervisory experience and lessons learned from examinations of third-party risk practices. It adopts a principles-based, non-binding approach designed to help banks and credit unions align and tailor their risk-management practices to the specific risks of individual third-party relationships.
When the guidance is finalized, the agencies plan to rescind existing third-party risk management guidance and replace it with the new document to promote consistency and prudent innovation across the banking sector. Comments are due 60 days after the notice appears in the Federal Register.
In a separate statement, the agencies outlined the factors they will consider when making supervisory and enforcement decisions concerning community banks' engagement with core service providers. The statement is intended to clarify expectations for banks that rely on essential third-party services.
The Federal Reserve Board also issued a distinct request for comment on a companion third-party risk management guide that targets Federal Reserve-supervised community banks, further extending the agencies' effort to refine risk oversight for this segment of the industry.
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