by. Kirk Drake
If you are not a financial institution or credit union than this won’t apply. If you are a credit union that is trying to compute or calculate the risk related to being down for a few hours to a few days read on…
Subjectivity of Measuring Risk
Our clients regularly ask us to measure or assess their risk related to a disaster event. In reality this tends to be a very tough and subjective thing to calculate. After conducting hundreds of risk assessments for lots of clients we have determined that there was no easy way to compare organizations and appropriately measure. Along the way we figured out how to use the credit union regulatory data to calculate risk from business process consistent across all credit unions. This means we can measure risk related to ACH, Credit Cards, Share Drafts, reputation risk etc. consistently across all credit unions.
FIA (Financial Impact Analysis) Credit Unions use the FIA data provides information so the Senior Mgmt team can make informed decisions upon where to spend money for disaster recovery and find the point in time that the credit union would bend but not break financially. This information can also be used to more effectively select insurance. Using a standardized methodology that is based on the credit unions actual numbers seems to have helped credit unions get an unbiased view of their financial risk and be able to better prioritize their recovery budgets. All credit unions can pull a free FIA by going to http://fia.ongoingoperations.com/fia.aspx
