Tough Times Call for Creative Risk Controls

Cofod, Bob
October 2005
Bank Technology News;Oct2005, Vol. 18 Issue 10, p54
Trade Publication
This article focuses on the need for creative thinking in risk control in the financial service industry. According to management theorist Peter Drucker, organizational and market change is unavoidable but that implies that change should be postponed as long as possible. A change process brings several risks that are to be handled creatively. The author cites several examples of business risks, like that of Enron Corp., Global Crossing Ltd. and WorldCom Inc. Since banks have had to respond to many interrelated problems as they have occurred, there has been little opportunity to consider the potential for consolidation and develop a true enterprise concept for risk management. Financial managers, suggestively, need to look at overall problems and evolve a true understanding of risk management for the enterprise that considers all of the requirements.


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