In episode 19 of the Risk Intel Podcast, Ed Haski from our partners at the Risk Management Association (RMA) shared invaluable insights derived from his extensive career managing risk in the banking sector. Ed's journey, spanning from small community banks to major investment banks, has rendered him a seasoned expert in the realm of risk management. Read below for a condensed overview of the key takeaways from the episode, delving into crucial aspects of risk management in the banking industry.
Ed Haski's illustrious career commenced at a modest $2 billion bank in central Pennsylvania over three decades ago. Throughout his professional odyssey, one central theme consistently emerged – a relentless focus on risk management. His career trajectory took an intriguing twist when he transitioned back from large banks to smaller community banks. Despite the allure of the community bank culture, he encountered notable disparities in terms of available resources and technological infrastructure - much like we still see today with our small bank customers.
His passion for risk management lead Ed to his current role at the Risk Management Association (RMA), which entails aiding RMA members in navigating the intricate terrain of risk management. He emphasizes the pivotal role of empathy and leveraging personal experiences to guide members towards informed decision-making.
Smaller banks are often compelled to operate with limited personnel and resources dedicated to risk management. Ed underscored the challenge of having restricted human resources to validate decisions, a phenomenon more frequently observed in larger institutions. His experience at smaller banks frequently grappled with budget constraints, impeded his ability to invest in cutting-edge technology. This technological disparity can profoundly affect a banks risk management capabilities compared to their larger counterparts.
Ed underscores how technology tools, such as the RMA Risk Maturity Framework and risk rating methodologies, can significantly enhance the efficiency of risk management processes. These tools furnish rapid insights into risk, empowering banks to make informed decisions in a cost-effective manner.
Ed emphasized the significance of forging a common risk framework within an organization. Standardized risk management practices and methodologies are pivotal for effective communication with regulators and the board. He also advocated for simplicity in risk management tools and processes.
"Overly intricate systems can lead to confusion and hinder decision-making, underscoring the value of straight forward, user-friendly solutions." - Ed Haski
Ed highlights that technology has become more cost-effective, even for smaller banks. Collaborations with organizations like SRA for products like the Risk Maturity Framework can offer accessible technology solutions, empowering smaller institutions to bolster their risk management practices. Its an affordable product or tool that any size institution can use to measure their overall effectiveness of their risk program.
Ed Haski's voyage through the banking industry offers a distinctive perspective on the challenges and prospects of risk management. His experiences illuminate the paramount significance of effective risk management practices, irrespective of a bank's size, and the pivotal role of technology in realizing this objective. As the banking landscape continues to evolve, Ed's insights provide invaluable counsel for professionals endeavoring to navigate the multifaceted realm of risk management.