Severity Level: Priority 2 Category: IT Governance / Risk Management

Description: The organization does not have a regularly convened official IT Committee, resulting in a lack of structured oversight for IT-related decisions, risks, and strategies. Without a dedicated committee, there is no formal forum for discussing emerging threats, aligning IT initiatives with business goals, or ensuring accountability in IT governance, which can lead to fragmented decision-making in a regulated financial environment.

Impact:

• Inadequate oversight of IT risks and investments, potentially leading to unaddressed vulnerabilities or misaligned resources.
  
  
• Delayed response to regulatory changes or technological advancements due to absence of collaborative review processes.
  
  
• Non-compliance with governance standards, increasing the likelihood of audit deficiencies and penalties.
  
  
• Reduced strategic alignment between IT and business objectives, impacting overall operational effectiveness.
  
  
• Potential for siloed operations, where IT issues are not escalated appropriately to executive levels.

FFIEC Reference:

• FFIEC IT Examination Handbook (November 2019):
• “Institutions should establish an IT governance structure, including committees, to oversee IT risks and strategies.” (p. 10)
• “Regular committee meetings ensure ongoing monitoring and alignment of IT with business needs.” (p. 11)

Recommendations:

• Establish IT Committee: Form a formal IT Committee comprising key stakeholders from IT, executive management, and risk functions.
  
  
• Define Charter and Schedule: Create a committee charter outlining roles, responsibilities, and a regular meeting cadence (e.g., quarterly).
  
  
• Integrate Risk Discussions: Incorporate agenda items for reviewing IT risks, projects, and compliance status.