Regulators Outline Procedures for Monitoring Technology Vendors

WASHINGTON – Federal bank regulators gave their examiners new guidelines Wednesday for supervising technology service providers.

A revised booklet on supervising such providers – issued by the Federal Financial Institutions Examination Council – discusses the regulators’ authority to oversee third-party vendors with contractual agreements with banks, and outlines the agencies’ information technology rating system.

The “booklet stresses that a financial institution’s board of directors and management has the ultimate responsibility for ensuring outsourced activities are conducted in a safe and sound manner and in compliance with applicable laws and regulations,” the council said in a press release.

Bank regulators on the council – the Federal Reserve Board, the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency – also concurrently released new guidance specifically for their examiners to aid in monitoring technology providers. The guidance outlines the process for regulators to carry out their interagency supervisory process, and includes templates examiners are to use in completing supervisory reports.