Federal financial regulators need to focus on industry cybersecurity and to respond more quickly to industry issues, a survey of financial institutions revealed.
The Office of the Superintendent of Financial Institutions (OSFI) published the results of its latest industry performance review, which found that federal financial firms overall want the regulator to prioritize cyber risk and security in the years ahead.
Insurance companies also highlighted environmental risks, regulatory burden, and accounting standards, as top concerns, it noted.
Additionally, the review — which was carried out in the autumn of 2018 by independent research firm Phoenix Strategic Perspectives — found a decline in the industry’s assessment of OSFI’s speed in responding to market developments and industry feedback on regulatory issues.
“Areas of improvement identified in 2018 relate to OSFI’s response time to market developments or industry suggestions that guidance needs updating, and developing guidance that balances prudential considerations and the need for institutions to compete,” the survey report stated.
Overall, the review found that the industry is generally pleased with OSFI’s oversight work. However, it reports that survey found a decline in firms that give the regulator very high scores.
“This decline is most pronounced among deposit-taking institutions, with the proportion reporting the highest level of satisfaction significantly lower than the previous [survey],” it said.
One area that has improved since the previous survey in 2016 is OSFI’s scaling of its guidance and supervision to the size of the firms it oversees.
“The highest positive ratings in the 2018 survey pertain to satisfaction with OSFI’s effectiveness in supervising financial institutions,” it noted.