The banking landscape is a rapidly changing dynamic environment. The sector has seen pervasive developments such as the increasing effect of regulatory constraints, fiercer competition (e.g. from new entrants), changing business models, technological advancements and of course digitalisation. These developments, which all come with challenges, have a direct impact on the requirements that are made of adequate risk management procedures. 

The need to be agile is becoming more and more urgent for banks. How do you stay agile enough to respond effectively to new developments, opportunities and threats? 

Risk management and compliance

If you ask BDO, it’s essential for banks to have an effective risk framework that’s tailored to their organisation and forms an integral part of their business practices. This not only allows banks to manage their risks, but also helps them achieve their objectives. 

Speaking of risks: compliance is steadily moving up the list of principal risks facing banks. And it will continue to do so over the next few years due to stricter rules and regulations. Banks are aware of the risks, such as money laundering and excessive operating expenses, but – despite focusing heavily on them – the entire sector has trouble coming to grips with them. 

Digitalisation and use of data

Digitalisation is consistently gaining traction for banks. What’s more, obvious changes in services such as PSD2  have great impact on how they are organised. Process digitalisation continues to be a hot topic, partly because of increasing cyber-risks. This raises the following question for banks: how do we best protect our data and, by extension, protect the interests of our customers?
Banks also need to answer a number of pressing questions about the use of this data: how can we access and use the huge amount of data we have access to? How do we ensure proper compliance with the entire spectrum of data protection rules? How do we use the opportunities offered by data analysis, process mining and Al? Many banks are finding it a real challenge to apply these technologies properly. Where to start and how to begin?

Financial economic crime

Financial economic crime (FEC), which is a collective name for irregularities such as money-laundering, terrorist financing and bribery, is a matter of great importance for banks. Banks need to carefully consider how they structure their customer acceptance procedures; having in place a robust due diligence process will help to prevent problems. Digitalisation can offer the right tools, one of which is digital identification. Compliance with AML rules remains a challenge for many banks in the Netherlands. How do you find enough of the right people to do the job? Can your processes be designed more intelligently? What technological support do you need?

From Dutch GAAP to IFRS

There are developments in the area of financial reporting in the banking sector as well. The Dutch Central Bank (DNB) has requested banks to use IFRS rather than Dutch GAAP as the basis of preparation for their financial statements. This transition to IFRS has become much more complex with the entry into force of IFRS 9 (Financial Instruments). That’s why, as a bank, you’d be well-advised to engage a specialist with the right expertise.

What BDO can do for you

Do some or all of the issues we described above apply to your organisation? Whether you need advice on operational audits, are having to review your governance structure due to shifting responsibilities or are faced with new regulatory issues, BDO offers tailor-made solutions. As a bank, you’re looking for an adviser who understands your problems, knows the market and can offer practical solutions that help you overcome the challenges you face. BDO takes a multidisciplinary approach; we put together teams from different disciplines to devise the best and most effective solution for you.

Want to find out more about BDO’s personalised and pragmatic approach for your bank? Our specialists would be happy to talk to you about your options and our hands-on solutions.