WASHINGTON—Federal bank regulatory agencies have released a guide to support community banks in managing risks presented by third-party relationships.
“Third-party relationships present varied risks that community banks are expected to appropriately identify, assess, monitor, and control to ensure that their activities are performed in a safe and sound manner and in compliance with applicable laws and regulations,” the Fed said in a statement. “These laws and regulations include, but are not limited to, those designed to protect consumers and those addressing financial crimes.”
According to the Fed, the guide offers potential considerations, resources, and examples through each stage of the third-party relationship and may be a helpful resource for community banks.
“While the guide illustrates the principles discussed in the third-party risk management guidance issued by the agencies in June 2023, it is not a substitute for that guidance,” the Fed added.
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