U.S. agencies propose tailored guidance on banks’ outside providers

U.S. financial regulators are seeking comment on guidance to tailor third-party risk management to individual relationships.

A firm providing a critical service can pose different risks from a supplier performing a minor task. Proportionate oversight takes that distinction into account.

The proposed approach is principles-based and non-binding. The guidance remains a proposal rather than a new binding rule.

Outside providers can introduce dependencies involving systems, data and service continuity. Managing those dependencies requires information about the relationship, rather than treating every supplier identically.