Global Bank Risk Management Survey (EY)

Summary

• Cybersecurity risk remains the top priority for bank CROs over the next 12 months, cited by 73% of survey respondents.p.8
• Regulatory risk moved up to become the second most important near-term priority, with 36% of CROs selecting implementation of regulatory rules or supervisory expectations.p.8
• Financial risks have resurfaced, with 66% of CROs identifying liquidity or funding risk as a top financial concern for the next 12 months.p.12
• Over a five-year horizon, climate change (56%) and machine learning/AI (53%) are viewed as the most important emerging risks for risk organizations.p.10
• Process automation is highlighted as the primary driver to accelerate digital transformation in the next five years, selected by 74% of CROs.p.16
• Talent acquisition remains critical, with 62% of respondents citing cybersecurity and 59% citing quantitative analytics as their most challenging hiring skill sets.p.25

Key insights

1. There is a 37 percentage point gap between cybersecurity risk and the second-most urgent CRO priority for the next 12 months.p.5
2. 83% of CROs expect geopolitical risks to have a similar or greater impact on their institutions in five years compared to today.p.11
3. 100% of banks with over $1 trillion in assets identified liquidity or funding risk as a primary financial risk priority.p.12
4. Only 10% of surveyed banks report being fully prepared for the finalization of Basel III requirements.p.14
5. Scale of change required (54%) and limited budgets (48%) are cited as the main constraints preventing banks from accelerating digital transformation.p.16
6. 37% of respondents state their bank has decided not to pursue a strategy that includes digital assets at this time.p.18
7. 58% of CROs describe their bank's control culture as largely reactive to issues identified through testing, RCSAs, or supervisory feedback.p.23
8. 52% of risk leaders anticipate an increase of 1% to 15% in full-time equivalent risk management professionals in both the first and second lines of defense over the next five years.p.24
9. 45% of banks are utilizing machine learning and AI specifically for fraud identification.p.28