Looking Ahead in 2022

One of CLA’s strategic advantages is our deep industry specialization. As we look to get a leg up on 2022 and absorb the lessons learned from 2020 and 2021, we see numerous opportunities and areas of focus for our financial institution clients. If we’ve learned anything during this time, it’s that we need to look at risk differently in this ever-changing environment.

1. Credit Risk – Credit risk remains a critical priority for financial institutions and regulators as COVID relief funds continue to come into play for many borrowers. These funds were utilized to keep businesses operating at the peak of the pandemic. However, with high levels of inflation and continuing labor and supply chain disruptions, pressures on many small businesses continue and may impact the credit quality within your financial institution. Now more than ever remaining engaged with your borrowers and looking past traditional credit metrics to identify issues could minimize future losses for your financial institution.

• Cybersecurity Risk – Cybersecurity, like credit risk, is another critical priority. Cyberattack instances are recognized across all industries and reflect a relentless pursuit by cybercriminals to steal data for financial gain. Most recently the Russian State-Sponsored Cyber Threats became the latest alert for the industry. As more and more data is gathered and maintained, the need to have the appropriate levels of expertise and protection of customer data is paramount.

• Workforce Risk – Challenges within the workforce continue and could pose a vulnerability to a financial institution. Lack of personnel and, more specifically, adequately trained personnel introduces financial and reputational risk to organizations. The continued increase in workload on those who remain could also expose the financial institution. Additionally, what was viewed as a positive shift at the onset of the pandemic in working remotely has now evolved into expectations from employees to continue to do so. Each financial institution needs to evaluate this through the lens of culture, growth, customer engagement, and risk.

• Planning for the future – Succession and strategic planning, including M&A, should be evaluated in the context of this new environment. Financial institutions should ensure their strategic planning sessions consider how new industry opportunities and threats impact their organization. These include, but are not limited to, succession planning, mergers or acquisitions, FinTechs, changing demographics, and the shift in the regulatory perimeter. How will your financial institution react and strategize?

How Can We Help?

CLA continues to provide seamless, integrated capabilities to our clients. Whether you need help navigating some of the issues related to the pandemic, require risk management services, or need a trusted advisor, we are here to know you and to help you. Contact Us to learn more.