These are the top seven risks to banks since the COVID-19 pandemic started, as determined by the 2020 Community Bank Follow-up Survey.

1. Enterprise Risk · Credit Risk · Market Risk · Operational Risk · Regulatory Affairs · Securities Lending
1
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THE TOP 7 RISKS CHALLENGING THE
FINANCIAL SERVICES INDUSTRY IN THE
COVID-19 ENVIRONMENT

2. Enterprise Risk · Credit Risk · Market Risk · Operational Risk · Regulatory Affairs · Securities Lending
2
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These are the top 7
risks according to
RMA’s 2020
Community Bank
Follow-up Survey,
which took place after
the COVID-19
outbreak started.

3. Enterprise Risk · Credit Risk · Market Risk · Operational Risk · Regulatory Affairs · Securities Lending
3
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KEY AREAS OF RISK IN THE COVID-19 ERA
Operational
Risk
IT
Risk
Interest Rate
Risk
Market
Risk
Cyber
Risk
Credit
Risk
Strategic
Risk
1 3 42
5 6 7

4. Enterprise Risk · Credit Risk · Market Risk · Operational Risk · Regulatory Affairs · Securities Lending
4
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CREDIT RISK
• Paycheck Protection
Program
• Economic Injury
Disaster Loans
• SBA Debt Relief
• SBA Express Bridge
Loans.

5. Enterprise Risk · Credit Risk · Market Risk · Operational Risk · Regulatory Affairs · Securities Lending
5
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CYBER RISK
$150/record
Average cost of
an incident
$3.9 million

6. Enterprise Risk · Credit Risk · Market Risk · Operational Risk · Regulatory Affairs · Securities Lending
6
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IT RISK
New work methods:
• Work from home
• Video conferencing

7. Enterprise Risk · Credit Risk · Market Risk · Operational Risk · Regulatory Affairs · Securities Lending
7
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• Deteriorating credit
quality.
• Liquidity stress.
• Volatile market
conditions.
• Agility of the bank.
MARKET RISK

8. Enterprise Risk · Credit Risk · Market Risk · Operational Risk · Regulatory Affairs · Securities Lending
8
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STRATEGIC RISK
Income
shortfall
Positioning
in the
COVID-19
environment
Change
management
Innovation

9. Enterprise Risk · Credit Risk · Market Risk · Operational Risk · Regulatory Affairs · Securities Lending
9
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Third-party
risk
Critical
employees
Infrastructure
risks
OPERATIONAL RISK
Operational resilience: regulatory and business focus.

10. Enterprise Risk · Credit Risk · Market Risk · Operational Risk · Regulatory Affairs · Securities Lending
10
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Regulatory risks: more emphasis
on measurement and management.
Value of
future
cash
flows
Future
interest
income
Future
expenses
INTEREST RATE RISK (IRR)

11. Enterprise Risk · Credit Risk · Market Risk · Operational Risk · Regulatory Affairs · Securities Lending
11
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Visit https://www.rmahq.org
for information on risk management.
RMA is a member-driven professional association whose sole
purpose is to advance sound risk management principles in the
financial services industry.
RMA helps its members use sound risk management principles to
improve institutional performance and financial stability, and
enhance the risk competency of individuals through information,
education, peer sharing, and networking.
Become a member today
https://www.rmahq.org/membership-types/