Credit Union Risk Assessment

Credit Unions are under all sorts of regulatory scrutiny this days and there is great pressure to reduce risk. This page provides an overview of the basics of any risk assessment as well as the different types of Credit Union risk assessments.

The primary goals of a Risk Assessment are:

  • Evaluate various threats from some set of circumstances (financial, disaster recovery, security, etc.)
  • Analyze threats based on likelihood and potential impact to institution, members and financial market
  • Prioritize potential business disruptions based on severity which is determined by impact on operations and probability of occurrence
  • Perform “gap analysis” that compares existing policies and procedures to be implemented based on likelihood and impact of the scenarios

A Risk Assessment should meet the following criteria:

  • Be Documented
  • Reviewed and approved by Board and Senior Management annually
  • Disseminated to employees
  • Properly managed when outsourced to 3rd party

A Risk Assessment should address these specific items:

  • Provide specifics regarding what conditions should prompt implementation of the plan and the process for invoking
  • Immediate steps that should be taken during a situation
  • Flexible for unanticipated scenarios and changing internal conditions
  • Focused on impact of various threats that could potentially disrupt operations
  • Developed based on valid assumptions and interdependencies

Credit Union Risk Assessment Types:

For Credit Unions – there are many different types of risk assessments that you might need depending on what services and products you offer. Here is a short list of some potential Credit Union risk assessments:

  • Financial Risk Assessment – ALM (Asset Liability Management)
  • Disaster Recovery Risk Assessment or Business Continuity Risk Assessment
  • Online Banking Risk Assessment
  • Security Risk Assessment (Robbery, physical security controls)
  • IT Security Risk Assessments
  • Competitive or Market based Risk Assessments

Are you trying to determine the best way to store and organize a Business Continuity Plan? Do you worry about how to get your employees or co-workers engaged in the BCP process? If you have these or other questions fill out this quick form: