Enterprise Risk Management

Enterprise Risk Management (ERM) is more than simply a collection of policies, procedures, limits, and models. Effective risk management also requires a strong risk culture and risk governance. Risk culture is the system of values and behaviors within the organization that shapes the day-to-day decisions that we all make. Developing a risk culture is a continuous process – it is consistent with, and builds upon, our Core Values, Leadership Competencies, and Code of Business Conduct & Ethics in that it is based on a common understanding that managing risk is everyone's responsibility and creates an environment that encourages the open exchange of ideas, willingness to elevate concerns, and a commitment to "doing the right thing." As such, risk culture is a critical element of the Bank's risk management efforts.

Also critical to Fifth Third Bank's approach to Enterprise Risk Management is a Risk Appetite Framework that defines how much risk is taken by the Bank. This Risk Appetite Framework is supported by an Enterprise Risk Management Framework that defines key risk activities for the eight different risk categories of credit risk, liquidity risk, market risk, operational risk, compliance risk, legal risk, reputational risk, and strategic risk. If you are interested in helping to further develop our risk culture, consider a career within Enterprise Risk Management at Fifth Third Bank.

At Fifth Third Bank we utilize an Enterprise Risk Management Division that is comprised of the risk functions below.

Commercial Credit Risk

Independent from the lines of business, Commercial Credit Risk is responsible for the overall risk strategy of the portfolio of commercial loans originated by the lines of business. Commercial Credit personnel have direct responsibility for the administration, implementation, and adherence to the Bank's policies and guidelines related to commercial credit.

  • Commercial Credit approval process
  • Commercial portfolio monitoring
  • Commercial loan risk rating (Regulatory and Dual Risk Ratings)
  • Charge-off and non-accrual decisioning
  • Authorization of lending authorities
  • Commercial Credit personnel training and development
Consumer Credit Risk

Provides independent risk assessment and oversight of the Consumer Line of Business, while providing guidance, tools, analyses, and reports to the business to ensure that risks are effectively managed. Functions include:

  • Developing and deploying sound credit loss forecasts across all Consumer Lines of Business
  • Stress testing, Portfolio Management & Optimization, and other ad hoc analytics
  • Maintaining all Consumer models, including ensuring that they are subject to appropriate independent validation
  • Providing management with pertinent information concerning the quality of new loans originated (or purchased) by the Bank
  • Reviewing and approving broker/dealers by the Third Party Management department within the Consumer Credit Risk Management department
  • Monitoring the effectiveness of property valuation strategies and appraiser and appraisal management company performance to ensure the accuracy of appraised values
Risk Strategies & Reporting

Provides quantitative analysis to support:

  • Commercial Credit loss forecasts, risk ratings (PD/LGD), and the Allowance for Loan and Lease Losses ("ALLL")
  • Developing commercial credit risk reporting, portfolio management, and overseeing commercial credit policies
  • Internal Capital Adequacy (ICAP), including Economic Capital modeling to quantify capital usage for all risk types and to measure risk levels against Risk Appetite
  • Risk-adjusted return on capital ("RAROC") measures intended for use in pricing and portfolio management
Bank Protection

Responsible for the design, development, implementation, and oversight of the Bank's Enterprise Fraud program, including the fraud prevention, detection, strategy program and the Investigations and Recovery program. Bank Protection partners with the lines of business to manage fraud and security risk across people, products, and channels by identifying current and emerging fraud and security risks and utilizing tools, strategies, and policies to manage risk while delivering an optimal and appropriate customer experience.

Enterprise Risk Management Programs/Operational Risk Management

Partners with the lines of business and provides independent oversight to ensure that operational risk identification, assessment, management, monitoring, and reporting processes are adequate and accurate. As such, ERM serves as the second line of defense in controlling operational risks. The ORM function also develops methodologies and tools to support Operational Risk Management and provides reporting on aggregate operational risks. The ERM programs and ORM function administer the risk and control self-assessment process and ensure compliance with Sarbanes-Oxley requirements.

Market Risk Management
Charged with providing independent oversight while interacting and collaborating with the lines of business on a daily basis. Duties involve the monitoring and reporting of activity and exposure. Analysts in CMRM are deeply imbedded in the department they oversee and support, and have access to systems and data that are necessary in order to assess market risk and evaluate that risk in concert with the Bank's risk appetite. CMRM also is intricate to all New Product/ Process Initiatives (NPIs) in identifying new or additional risks being introduced, as well as the capacity to measure and monitor the risks.
Compliance Risk Management
Designs, develops, and executes compliance programs on behalf of Fifth Third Bank. This team addresses a widespread number of regulations and partners with business lines to develop solutions, but also serves in a fiduciary oversight role to ensure programs are within the Bank's risk appetite. The legislative and regulatory landscape continues to quickly evolve, which necessitates continued professional growth from team members. Coaching is a priority to further help our teams to be positioned for tomorrow's challenges.