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2020 COVID-19 Report

COVID-19 is an infectious disease caused by the SARS-CoV-2 virus. Most people infected with the virus will experience mild to moderate respiratory illness and recover without requiring special treatment.

A new report titled – Global operational resilience and COVID-19 –  reveals how financial institutions are managing operational resilience in the wake of the pandemic.

Whilst 38% of respondents felt their institution had moderately comprehensive operational resilience frameworks before the pandemic, the same proportion confirmed their framework was either “in development” or “in place but required improvement”.

Consequentially, the pandemic has prompted a robust response from the financial services industry with 80% of respondents stating that their institutions now has enhanced governance and oversight due to the crisis.

Managing external stakeholders and third parties, IT connectivity, business travel disruptions, and supervision and oversight were four areas in which respondents had experienced challenges during the earlier phase of the pandemic.

Respondents have identified conduct risk, cyber and data security, cash flow and profitability, and the impact of loan loss provisions as primary areas of systemic concern.

Correspondingly, respondents expect greater regulatory scrutiny and enforcement action to focus on controls and risk management frameworks, technology and management information, accountability regimes and financial crime risks.

Given the ongoing disruption caused by the pandemic, more than 70% of respondents expect that their organisations will increase their operational resilience budgets in 2021.

The report was published by international law firm Norton Rose Fulbright. Norton Rose has one of the largest global energy, infrastructure and resources teams of any legal practice in the world with more than 1500 lawyers.