Due Diligence and Ongoing Monitoring

Hello,

I was wondering if you can guide me in the below situation and give me more insights about market trends.

Our Head Office bank is about to open a new branch in a foreign country and there are some discussions about allowing the foreign branch to outsource "Risk Management Function"  and Audit from the head-office.( I mean the both two functions will be implemented from head office team ) 

I'd like to know how could it be done?

and is it normal a trend for banks opening foreign branches to do so?

what is the first , second and third party in this relationship? 

 I need your guidance how can I assess the risks related to such outsourcing agreement from TPRM perspective. If this TPRM scope 

As I see that there might be some conflict of interest in outsourcing such function to headquarters as I as TPRM Head will be assessing the risks related to a relationship that I am part of it.

Thank you in advance

Although I can't say for certain if this is a normal trend, I can provide some tips that may help you determine how to move forward.

As a first step, I would recommend thinking about which country the new branch will be located in, since laws and regulations differ based on jurisdiction. The new branch must be compliant with these unique laws and outsourcing the risk management and audit function may not be permitted.

I think it's accurate to say there may appear to be some bias or conflict of interest if you yourself are assessing the risks. Therefore, I would first suggest engaging your compliance department who can advise you on the regulatory requirements in that specific country or jurisdiction. Using a third-party auditor to assess the risks of this outsourcing agreement can also give you an outside perspective and help avoid any potential conflicts.

I hope my reply provides some value and I'm interested to see some other perspectives.

Hello,

I was wondering if you can guide me in the below situation and give me more insights about market trends.

Our Head Office bank is about to open a new branch in a foreign country and there are some discussions about allowing the foreign branch to outsource "Risk Management Function"  and Audit from the head-office.( I mean the both two functions will be implemented from head office team ) 

I'd like to know how could it be done?

and is it normal a trend for banks opening foreign branches to do so?

what is the first , second and third party in this relationship? 

 I need your guidance how can I assess the risks related to such outsourcing agreement from TPRM perspective. If this TPRM scope 

As I see that there might be some conflict of interest in outsourcing such function to headquarters as I as TPRM Head will be assessing the risks related to a relationship that I am part of it.

Thank you in advance

Thank you Kitamura, the regulatory in foreign branch allow  outsourced those two function from head office  but at the same time without diminish the branch responsibilities and any conflict of interest . therefore we interpret  the word outsourced not means  TPRM scope but the head office will support , oversight but not the head office staff will handle day to day business .

what do think 

Although I can't say for certain if this is a normal trend, I can provide some tips that may help you determine how to move forward.

As a first step, I would recommend thinking about which country the new branch will be located in, since laws and regulations differ based on jurisdiction. The new branch must be compliant with these unique laws and outsourcing the risk management and audit function may not be permitted.

I think it's accurate to say there may appear to be some bias or conflict of interest if you yourself are assessing the risks. Therefore, I would first suggest engaging your compliance department who can advise you on the regulatory requirements in that specific country or jurisdiction. Using a third-party auditor to assess the risks of this outsourcing agreement can also give you an outside perspective and help avoid any potential conflicts.

I hope my reply provides some value and I'm interested to see some other perspectives.

Hello,

I was wondering if you can guide me in the below situation and give me more insights about market trends.

Our Head Office bank is about to open a new branch in a foreign country and there are some discussions about allowing the foreign branch to outsource "Risk Management Function"  and Audit from the head-office.( I mean the both two functions will be implemented from head office team ) 

I'd like to know how could it be done?

and is it normal a trend for banks opening foreign branches to do so?

what is the first , second and third party in this relationship? 

 I need your guidance how can I assess the risks related to such outsourcing agreement from TPRM perspective. If this TPRM scope 

As I see that there might be some conflict of interest in outsourcing such function to headquarters as I as TPRM Head will be assessing the risks related to a relationship that I am part of it.

Thank you in advance