Risks to Consider When Reopening Your Branches

With the country slowly reopening from the COVID-19 pandemic, it’s time to consider the risks associated with reopening your branch locations.

With the ultimate goal of providing a safe environment where customers and branch employees can conduct banking business and essential operations, banks must be proactive in their risk mitigation efforts. While considering how to reopen branches or expand operations, it’s key that financial institutions review and incorporate the requirements of the CDC, OSHA, EEOC, DHS, WHO, DOL, and FFCRA into their plans. On top of this, banks should be following the guidance issued by state and local officials. Bank policy should be assisting in next steps and determination of priorities when reopening or expanding operations.

Plans for reopening should also address key risks and the associated mitigation efforts surrounding strategic, safety, operational, security, and compliance risks. 

  • Strategic risks arise from business decisions. Developing or reviewing the bank’s re-opening/continuing operations strategic plan to ensure it includes the bank’s mission, vision, external and internal environments, and business continuity plan is essential for making business decisions consistent with the bank’s values. Insurance providers should also be engaged to assess coverage associated with the risks of reopening.
  • Safety risks arise from potential harm to customer and employees. Deep cleaning high traffic areas, installing partitions, and providing appropriate PPE is crucial for the well-being of all individuals who enter the branch location.  Developing a temperature screening practice for all employees and customers, developing customer limits, and posting signage regarding the bank’s COVID-19 response are also essential for keeping all parties safe. 
  • Operational risks arise form a failure of process, people, and systems. Providing appropriate training to branch personnel, developing “Know Your Customer” procedures that keep all parties protected, and assigning personnel monitor and administer safety and crowd control practices are important for addressing the operational risks.
  • Security risks arise from the possible threat from a person or situation. Developing and executing new “Know Your Customer” procedures that effectively allow you to identify the customer without risking the health of either party is essential. With many individuals continuing to wear masks even when not required by orders, it will be more difficult to identify customers, however it is important that measures be to taken to identify those individuals while respecting their personal health concerns. The number of individuals wearing masks also increases the security risks associated with bank robberies, as the identity of individuals is partially hidden.
  • Compliance risks arise from failure to comply with state, federal, and financial regulators and their various laws and regulations associated with business operations. Assessing the bank’s ability to comply with the laws and regulations set forth by the various regulatory bodies should be the impetus for decision making surrounding reopening branch locations or expanding operations.

Failure to assess risks and develop risk mitigation strategies can impact your bank’s ability to successfully reopen branch locations.

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Material discussed is meant for informational purposes only, and it is not to be construed as investment, tax, or legal advice. Please note that individual situations can vary. Therefore, this information should be relied upon when coordinated with individual professional advice.

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