RE: Request for Information on Standard Setting and Voluntary Certification for Models and Third-Party Providers of Technology and Other Services; RIN 3064–ZA18
Robert E. Feldman
Executive Secretary
550 17th Street, NW
Washington, D.C. 20429
Dear Mr. Feldman,
The American Bankers Association is pleased to comment on the FDIC’s Request for Information (RFI) seeking feedback regarding the potential creation of a public/private standard-setting partnership and corresponding certification program to help reduce the cost, inefficiencies, and uncertainty related to bank onboarding of third-party service providers. Specifically, the RFI requests input on whether a public/private partnership could support banks’ third-party risk management efforts by certifying or assessing certain aspects of a third-party’s products or models or by evaluating a third-party provider’s operations or condition.
ABA appreciates the FDIC’s willingness to address some of the hurdles, duplication, and costs associated with managing third-party risk. Increasingly, a bank’s ability to compete in the marketplace will depend on its ability to leverage the expertise of third-party service providers. Banks that are unable to adopt new technologies or partner with new third parties will not be able to provide the products and services that customers expect. Unfortunately, the due diligence necessary to onboard a prospective vendor is costly, inefficient, and time consuming for both banks and service providers. These burdens exist for all institutions, but are particularly acute for community banks.
We are encouraged that the FDIC recognizes the strategic importance of third-party relationships and that Chairman McWilliams has made fostering innovation a top priority for the agency. In particular, we appreciate the FDIC’s willingness to explore strategies for reducing the friction and duplication associated with third-party onboarding and oversight.
Download the comment letter to read the full text.
