More Examples of Regulatory Compliance Processes

By Jacob Ukelson  |  Posted 2010-10-07 Print this article Print

More examples of regulatory compliance processes

Another example is a process initiated as a result of a decision taken during a board of directors (or any executive management) meeting. In this example, the meeting takes place, decisions are made and processes are initiated-but the processes themselves are different every time, depending on the context of the board meeting.

For example, let's say a bank's board is worried about the risk profile of the bank, especially their loans. Therefore, they will initiate a process regarding the risk management of loans to European real estate and construction projects. In this case, the bank made large loans for the construction of commercial real estate projects in a number of European countries and those projects have reached a point where they will be asking for additional funding to enable the project's completion. In the time since the original loans were granted, both the macroeconomic and microeconomic environments have changed, causing the bank to revisit the original assumptions underlying the loans.

These loans now represent large, relatively risky loans and have the possibility of external scrutiny of the handling of those deals, so the board decided to take a closer look. It requested that the international banking division and the real estate division jointly look into the viability and risk of the projects, taking into account various deal parameters such as the current legal situation of the country involved, the macroeconomic outlook, the expected amount of financing that will be requested, the financing sources for the projects, the capital structure of the projects and the current viability of the developers.

Such a deep dive in process will generate more activity involving numerous people throughout different divisions in the bank and experts from outside the bank. The specific participants and information assembled are dependent on the specifics of the loans being examined.

Jacob Ukelson is Chief Technology Officer at ActionBase. Jacob has a proven track record in discovering and developing innovative solutions to real-world customer problems and then developing them into products. Jacob is published in many technical journals and has spoken at conferences worldwide. In 1997, he received the Alexander C. Williams Ergonomics and Human Factors Award from the Human Factors Society. He can be reached at

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