Thanks a lot, Josh. Now, before I answer your questions, if I may, I have to do a standard disclaimer. What I’m trying to share with everyone here in this podcast is from my own experience. It’s nothing confidential, so nothing related to particular incidents or particular facts that I have been working on with various banks. It does not represent any of the positions of any of the banks, including the one that I’m working on at the moment.
So, your first question, if I hear correctly, is, “How do we prepare for different types of examinations — either monitor visits or regulator visits?” Before I answer this question, we need to understand why your regulator is coming to you. To understand where they’re coming from is the first thing that is very important, and we need to know about it.
There are different scenarios. It might be just a regular visit. There might be a thematical review: You’re just one of those banks or financial institutions picked out by your local regulators. It might be because of certain incidents that have happened to your financial institution, unfortunately, that we see in different types of monitorship or inspections, per se. So, this is the first one. So, understanding what the regulators are looking for is the most important. There’s what we call the KYR — know your regulators — so this is just like a KYC. You need to understand where they’re coming from.
Then, the second thing we need to bear in mind, the fundamental thing, is to stick to the facts of what happened, because when we’re talking about different types of inspections, review or monitorship, it is a look-back exercise. It’s not about forward-looking exercises, it’s a look-back exercise. So, the rule of thumb is, stick to the facts — understanding the scope as well, understanding where they’re coming from —and understand the scope of your review or inspections or monitorship. That’s very important as well. These are the things that you need to bear in mind as well.
Third, it’s communications, early communications with the regulators or monitorship — understanding what they’re looking for. Most likely, normally, the regulator will come up with a list of questions or a list of expectations as well. So, this is the quick start on how to be first prepared for the visit, and second, internally, once you’ve got all this basic information, you need to mobilise different departments.
The regulator visit is, more likely, not only the compliance work. This is a very important concept. The visit is not just the work of compliance. You need to mobilise different stakeholders within the bank. For example, nowadays, and very importantly, all direct leaders around the world are talking about senior management oversight, so these are the key important things that you need to be aware about. You need to engage your senior management so that they are on top of that. You have the full support of your senior management both locally or regionally, or even globally, about an upcoming regulator visit or inspection. And then —