In recent years–even months–banks have been forced to adapt to new regulations quickly. With no room for error in this strict financial climate, banks have had to make some serious changes in their approach to business and in the techniques they use to deal with the new regulatory system. In spite of all the changes, watchdog groups have asserted that “banks are feeling more optimistic about their business and ability to meet regulatory requirements,” (1) and the following are some of the techniques banks are using to adapt to new regulations.
Adopting New Software
One thing banks are doing is adopting new technology. Although they may be adapting to new software slowly, they are now well aware that software like a “fair lending analysis tool” (2) can ensure that they comply with strict fair lending regulations. By relying on sophisticated automation tools, banks are able to remove more human error associated with loan processing and enhance their overall compliance.
Over the last several years, banks have had to jump through lots of hoops quickly in order to change the way they do business and comply with strict laws and regulations that came into effect. Although change was challenging and downright difficult at first, banks have developed more ease with change and are coping better when new regulations are announced. By learning to adapt to change quickly, banks are better able to meet these regulations head on.
While new technology and an attitude that embraces change have been helpful for banks trying to meet new regulations, an influx of new personnel dedicated to compliance has also strengthened banks position in the strict regulatory climate. Banks are hiring increasing numbers of compliance professionals and, while it’s costing them more financially to pay the increased wages for these pros, it’s also benefiting them with improved regulatory compliance.
Banks that are meeting today’s challenges are typically doing these three things: adopting improved automation, embracing change, and hiring dedicated compliance professionals. If your bank is struggling in this new regulatory atmosphere, consider these three elements that may help you move forward with improved compliance practices.
Video: Professor Mario Tonveronachi from the University of Siena, Italy Discusses Financial Crisis and Banking Regulations
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1. Information Week, “Compliance Burden Increasing, but Bankers Don’t Feel It,” http://www.banktech.com/compliance/compliance-burden-increasing-but-bankers-dont-feel-it/d/d-id/1316970?
2. LoanLogics, “Controls for Compliant Borrower Pricing Discussions,” http://loanlogics.com/fair_lending.html