Risk analysis

• LogicGates Third-Party Risk Management solution offers unique capabilities such as enhanced automation of vendor risk assessments and easy tracking of risk-remediation and mitigation activities.
• This, combined with CynergisTeks VSM service, will help close the gaps between risk findings and remediation.
• The partnership will also allow CynergisTek to optimize operations by retiring an in-house developed risk management solution.
• Shortly after joining CynergisTek, I realized that we needed to take a more holistic approach with our Vendor Security Management offering, said Carrie Whysall, Director of Managed Security Services at CynergisTek.

• State Street Corporation (NYSE:STT) today announced the results of its 2019 mid-cycle stress test, consistent with section 165 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
• The results are based on State Streets internally developed severely adverse scenario and incorporate prescribed Dodd-Frank capital actions.
• State Streets Dodd-Frank Act mid-cycle company-run stress test disclosure, including general descriptions of methodologies used in the stress test, can be found in the Investor Relations section of its website, http://investors.statestreet.com .
• State Street Corporation (NYSE: STT) is one of the world's leading providers of financial services to institutional investors including investment servicing, investment management and investment research and trading.

• This effect is economically significant, as it amounts to a change in RWD of about 20% from the standard deviation of the RWD of the tested banks.
• This result indicates that banks participation in the 2016 EUwide stress test led to a material reduction in their risk-taking.
• [21] Table1 Effect of participating in the stress test on banks risk-taking

• Closer supervisory scrutiny related to the QA process applied by the ECB during the EUwide stress test seems to have contributed to a reduction in stress-tested banks risk-taking.
• [22] Table2 reports the outcome of the test of whether stress-tested banks reduced their risk more significantly when they were subject to more intense supervisory scrutiny during the stress-testing exercise (hypothesis 2).
• Column (2)illustrates that the tested banks that received an above median number of flags reduced, on average, their RWD by 5.6percentage points more than the below-the-median tested banks.
• In Columns (5)and (6), some evidence is shown that a longer duration of the QA process had a negative significant effect.
• Table2 Effect of being stress tested on banks risk-taking through the QA channel

5 Conclusions

• This article has highlighted certain strengths and weaknesses of the current constrained bottom-up approach of the EUwide supervisory stress tests.
• On the one hand, the bottom-up nature of the exercise provides banks with leeway and incentives to underestimate their vulnerabilities in order to appear better than their peers.
• These findings may be relevant for ongoing discussions about the long-term strategy for the European banking sector stress tests.

6 References

• Potential pitfalls when involving company's technical persons: a list of do nots'
  Role of IP - risk factor, nice to have or deal driver?
• - What if you are asked to make the deal happen even if the risk is high?
• - Can you mitigate that risk?
• Research and Markets also offers Custom Research services providing focused, comprehensive and tailored research.