Nationwide Title Clearing, Inc. has joined forces with National Mortgage News in an ongoing video series designed to provide a knowledge base about current trends and new regulations in the industry.
Nationwide Title Clearing, Inc. (NTC), a leading research and document-processing provider for the mortgage and financial industry, was recently requested to lend its expertise to an educational video series called “Ask the Experts” on the National Mortgage News website. A total of 12 videos featuring several NTC executives will be released weekly over the course of three months and will cover various topics, including property reports, regulatory compliance, and how to monitor overall risk on lien releases. The first video, which launched mid-March, featured NTC’s Chief Legal Officer Myron Finley, who discussed Enterprise Risk Management (ERM) and its importance within the mortgage industry.
ERM is an organization’s enterprise risk competence—the ability to understand, control and articulate the nature and level of risks taken in pursuit of business strategies—coupled with accountability for risks taken and activities engaged in, which contributes to increased confidence shown by stakeholders. (1) In recent history within the financial industry, potential risks have included the losses presented by non-producing mortgages and foreclosed properties. The Office of the Comptroller of the Currency (OCC) and other regulatory bodies have identified inadequate ERM as one of the primary causes of the credit crunch of 2008. Deputy Comptroller for Operational Risk Carolyn G. DuChene previously commented on the importance of ERM in banking today, and stressed the links between risk management and strategic and capital planning, stating, “Sound management of risk across the enterprise and good capital planning enhance the banks’ ability to be competitive and continue serving the needs of their customers and communities, and it ensures ongoing viability during difficult economic periods.” (2)
We’ve seen how important ERM is with regard to making sound business decisions—soon, we’ll see industry-wide baseline assessments, where each risk is mapped to a number of indicators that accurately display the true risks to which a company is exposed.
According to Finley, the years following the collapse of the housing market have upended the economy as a whole, but even more specifically the financial industry—a statement echoed by reports that 2013, four years after the Great Recession reportedly ended, (3) was marked by “unprecedented regulatory scrutiny, the rising importance of reputation, market volatility, greater demands from stakeholders, diverse vendor and third-party ecosystems, and new risks posed by mobility, big data and social media.” (4)
For banks of all sizes, per Finley, the challenge of building a strong risk management program remains what some deem to be a daunting task. But during his “Ask the Experts” interview, Finley provides some key takeaways in the area of risk management of which banks should remain cognizant.
“ERM requires a documented look at three quantities, one of which is the controls that are presently in place to mitigate either the severity of potential loss or the likelihood that it will occur,” Finley stated. “For each control, an organization must estimate its effectiveness in mitigating the associated risk—the product of those three quantities will produce that company’s exposure to each identified risk.”
As the industry becomes increasingly regulated, Finley predicts that growing expectations around ERM within the banking sector will necessitate an industry standard that includes continual risk assessment rather than the traditionally annual assessments of the past, which are no longer considered sufficient risk management, per Finley.
“We’ve seen how important ERM is with regard to making sound business decisions—soon, we’ll see industry-wide baseline assessments, where each risk is mapped to a number of indicators that accurately display the true risks to which a company is exposed,” said Finley.
NTC, perhaps best known for its expertise in extensive research and document-processing services such as lien release processing, is an advocate for best practices and legislation that standardize the mortgage industry for the betterment of homeowners, land records and the industry at large.
To watch the “Ask the Experts” video, click here.
About Nationwide Title Clearing, Inc.:
Based in Palm Harbor, Florida and founded in 1991, NTC is a privately-owned leading research and document-processing service provider to the residential mortgage industry. NTC serves mortgage lenders, servicers and investors, including eight of the top 10 residential mortgage servicers in the country. NTC is known for delivering the highest level of accuracy in research services and quality document processing that set the industry standard while protecting homeowners, assisting the mortgage banking industry and preserving the nation’s land records. The company’s land records and document experts are able to track and fulfill county document requirements in all recording jurisdictions nationwide, which is close to 3,600 different jurisdictions. NTC specializes in providing land records research, property reports, lien release services, assignment services, final document tracking, document retrieval and other custom business solutions. NTC’s expansion is tied to their contribution to their industry and their local community, ranking number 26 on the 2013 Fast 50 Awards list of fastest growing companies in Tampa Bay, and number 1,900 on the 2013 Inc. 500/5000 list of fastest-growing companies in America, up from number 2,730 in 2012. NTC also won the Inc. Hire Power award for the second consecutive year in 2013 for putting Americans back to work. For more information, visit the company’s website at http://www.nwtc.com.
1. “RMA Enterprise Risk Management.” N.p., n.d. Web. 06 May 2014. rmahq.org/risk-management/enterprise-risk.
2. “OCC Deputy Comptroller Discusses Enterprise Risk Management.” N.p., 22 Oct. 2012. Web. 06 May 2014. occ.gov/news-issuances/news-releases/2012/nr-occ-2012-150.html.
3. Irwin, Neil. “It’s Official: The Great Recession Ended Last Summer.” N.p., 20 Sept. 2010. Web. 06 May 2014. voices.washingtonpost.com/political-economy/2010/09/its_official_the_great_recessi.html.
4. Santora, Frank, and Susan Palm. “What Banks Learned About Risk Management in 2013.” N.p., 20 Dec. 2013. Web. 6 May 2014. americanbanker.com/bankthink/what-banks-learned-about-risk-management-1064464-1.html.