Federal Reserve seeks to clarify big bank risk management expectations

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FILE PHOTO: The Federal Reserve headquarters in Washington September 16 2015. REUTERS/Kevin Lamarque/File Photo

WASHINGTON – The Federal Reserve proposed new guidance Thursday that would clarify the regulator’s expectations for how senior managers at large banks handle risk at their respective institutions.

The proposed guidance would identify core principles for effective day-to-day management of a bank, ensuring risk is adequately managed. The Fed also proposed guidance outlining its expectations for how banks manage their various business lines in terms of risk.

The proposals are part of a broader effort at the Fed to overhaul its confidential internal large bank rating system. Thursday’s proposals are part of the effort to modernize that system, known as CAMELs, to reflect the host of new rules established by the Fed in recent years.

Reporting by Pete SchroederEditing by Chizu Nomiyama

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Godwin Okafor is a Financial Journalist, Internet Social Entrepreneur and Founder of Naija247news Media Limited. He has over 16 years experience in financial journalism. His experience cuts across traditional and digital media. He started his journalism career at Business Day, Nigeria and founded Naija247news Media in 2010. Godwin holds a Bachelors degree in Industrial Relations and Personnel Management from the Lagos State University, Ojo, Lagos. He is an alumni of Lagos Business School and a Fellow of the University of Pennsylvania (Wharton Seminar for Business Journalists). Over the years, he has won a number of journalism awards. Godwin is the chairman of Emmerich Resources Limited, the publisher of Naija247news.

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