Leveraging Adverse Media Monitoring with Owlin in Light of New Community Bank Guide
The newly released US federal Community Bank Guide1 underlines the weight regulators put on controlling third-party relationships. Although the guidance empowers community banks to navigate third-party risks, it lacks clear and tangible formal regulations, leaving banks seeking concrete strategies for meeting their compliance2.
In the guide, adverse media is emphasized as a useful source of information for the due diligence and monitoring stages in the TPRM life cycle. For example, banks can search for what the third party has said about itself in the media or on its website. Additionally, during ongoing monitoring (after the third party has been onboarded), the guide suggests banks can keep an eye on news articles, social media posts, and what customers are saying about their experiences with the company.
Figure 1. Stages of third-party risk management life cycle.
Owlin’s solution is fully suited to support the need for the aforementioned information during the selection and monitoring of third parties. As the banking sector grapples with evolving regulatory expectations, Owlin stands ready to equip community banks with the tools needed to fortify their risk management practices.
Why Adverse Media Provides Such Valuable Insights
At Owlin, we believe we can maximize the value around adverse media for our clients by systematically screening individuals or entities for negative news across a plethora of reliable sources (paid and unpaid) online sources.
Due to their nature (historic reporting), traditional sources such as financial statements, official ratings, and annual reports often fall behind in reflecting current events or emerging risks. Therefore, they will not provide early warning signals of potential risks stemming from recent events.
Adverse media monitoring, on the other hand, operates in real time or near real time, allowing for the timely detection of relevant information. This proactive approach enables banks to identify potential problems early on during third-party selection and continuously during the monitoring phase.
Figure 2: Examples of relevant adverse media during due diligence and third-party selection
Figure 3: Examples of relevant adverse media during ongoing monitoring
Solutions to Overcome Adverse Media Monitoring Challenges with Technology
Checking adverse media manually can be time-consuming, labor-intensive, and prone to costly errors. Especially when this is done in different languages and there is a big portfolio to cover. Moreover, in an ideal situation, adverse media monitoring is not a one-time process but an ongoing activity.
Therefore, community banks should consider implementing smart technology tools into their third-party risk management processes to overcome these challenges. This automation enables faster and more efficient adverse media checks, surpassing the capabilities of human compliance employees.
By leveraging technological advancements, specifically AI-based tools like Natural Language Processing (NLP), teams can analyze large amounts of data from around the world. This allows them to quickly identify potential risks in real-time, regardless of the entity’s size or location. It also speeds up the onboarding process by enabling instant screenings, ensuring the timely completion of necessary checks.
How Owlin adds value
Owlin speeds up the due diligence process and monitoring phases in third-party risk management with automated screening and continuously monitoring adverse media, providing early warning signals about crucial events before they escalate.
By monitoring over 3 million sources in 17+ languages, Owlin enables businesses to make well-informed decisions and proactively manage third-party risk. Users can customize personal filters to see the most relevant information, tailored to their specific needs. Moreover, the platform seamlessly integrates into existing workflow systems, offering flexibility and scalability for a comprehensive third-party management solution.
Schedule a demo!
Want to know how Owlin can help you capture and evaluate adverse media promptly, preventing them from appearing in financial statements or going unnoticed between periodic reviews? Schedule a personalized demo to learn more!