98% of RD banks have defined their risk indicators and 93% conduct tests

98% of Dominican financial intermediation entities have fully or partially defined their key risk indicators and 93% conduct stress tests, which are essential for measuring their resilience to adverse scenarios. This is revealed by the report Evaluation of the comprehensive risk management framework, published by the Superintendency of Banks (SB). The SB analyzed the considerations provided through a self-assessment survey by the 45 financial intermediation entities (EIF) to understand their comprehensive risk management processes based on governance, policies and procedures, and risk culture, among other related topics. Similarly, 1,342 professionals who are part of the risk teams, as well as the members of the boards of directors of the entities, participated in the survey. The SB’s publication highlights progress in the management of each of the risks, but also points out areas to be strengthened, such as the measurement of concentrations in its different aspects, the analysis of correlations between sectors, as well as continuing to include standards for the definition of risk management models. Additionally, to provide a more in-depth and technical approach in critical areas, the creation of specialized risk units should be encouraged. “IFIs have shown significant progress in their risk management, reflecting their commitment and effort. The growing adoption of technological tools to identify, monitor, and mitigate risks stands out,” assures the SB report. The collected data shows that, of the 30 IFIs with a risk culture plan, 11 conduct annual and quarterly assessments. Similarly, 31 of the 45 entities consulted state that they evaluate the considerations of their stakeholders. For 2023, 77% of IFIs had a specialized operational risk unit, compared to 89% in 2024, reinforcing the focus on quantifying risks due to human error, failures, and interruptions. Additionally, 44 entities have partially implemented key risk indicators and 18 of them have already automated them within their systems. In 2023, the use of risk management tools was 75% in monitoring, 70% in identification, and 55% in mitigation. For 2024, these increased to 80%, 71%, and 56%, respectively.

Training

Of the evaluated IFIs, 44 conduct risk training for all personnel, which is essential for strengthening the risk culture and raising awareness among employees. In 2023, 88.6% of the entities trained all personnel in risks, while this proportion climbed to 98% in 2024.