FinTech LIVE Dubai: Managing Risk at the Pace of Business

At FinTech LIVE Dubai 2024, the focus on risk management has never been more pertinent. Khurram Khan, the Assistant General Manager and Head of Non-Financial Risk at Boubyan Bank, shared his extensive experience and insights into the landscape of risk management in the financial sector.

Boubyan Bank, a prominent financial institution in Kuwait, has been at the forefront of integrating comprehensive risk management strategies. As Khan explains: “Risk management and security is kind of at the heart of all of it. It cuts across all of those areas.” His two-decade-long career spans technology, security, and financial services, providing a rich background for his current role in overseeing non-financial risk at Boubyan Bank.

Khan observes a significant shift in the types of risks that financial institutions face today. Traditionally, the focus was on financial risks like credit exposure and market risk. However, the last several years have seen a rise in non-financial risks.

“Technology can fail because everything depends on technology. You have cyber-attacks that are growing. You have regulatory requirements around data privacy and data protection,” Khan continues, highlighting the complexities introduced by the digital age.

One of the critical strategies Boubyan Bank employs is the integration and consolidation of risk management functions across the organisation.

“We look at incidents that happen or risks that arise; it might on the surface come through as a technology incident or a business process issue, but because we work cross-functionally and we're all part of one group, things can then slide into other areas,” notes Khan.

This holistic approach ensures that risks are not only identified but also addressed in a manner that prevents recurrence.

Khan also emphasises the importance of effective communication and processes within the risk management framework: “You can buy the best technology in the world, but if you are not using that effectively, you're not using the internal processes and communications effectively, things can fail.” This highlights the need for a robust governance structure that ensures all stakeholders are engaged and informed.

A notable initiative at Boubyan Bank is the implementation of a risk champions framework. This approach assigns specific individuals within business units to act as points of contact for risk-related activities. These ‘risk champions’ are responsible for reporting incidents and working with the risk management team to resolve them. Khan explains, “We saw the success the first year. We actually demonstrated the results and we were able to materially reduce expected losses by over 40%.”

Striking a balance between risk management, business growth, and customer experience is another key area Khan addresses. Effective risk management processes must not hinder business operations but rather enable them.

“Our goal is to help the business win and achieve the objectives that they're after,” Khan states.

By streamlining risk assessment processes, Boubyan Bank has reduced the time required for risk assessments from several months to just two weeks, demonstrating a significant improvement in efficiency.

Looking to the future, Khan identifies emerging challenges in risk management, including sustainability, artificial intelligence (AI), and data privacy: “We are building an AI strategy and framework right now. It's a cross-functional strategy, and you cannot ignore the security and risk and ethics side of it,” he mentions. This proactive approach ensures that new technologies are integrated thoughtfully and securely into the bank’s operations.

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