The Central Bank of Liberia has warned banking institutions operating in the country to comply with the Enterprise Risk Management (ERM) policy to prevent loss of resources and capital.
The ERM policy warning was contained in the CBL 2014 annual Financial and Economic Bulletin.
The ERM specifically addressed the structures, processes and standards implemented to manage risks on an enterprise-wide basis in a consistent manner.
As part of curtailing losses, the CBL wants institutions to set up enterprise risk registry and coordinators that will serve as the basis of the risk management activities of the bank.
According to the CBL report, ERM seeks to build a risk-smart work force and environment that allows for innovation and responsible risk taking while ensuring legitimate precautions are taken to protect the bank.
It also seeks to provide guidance to the development and implementation of modern management practices and to support innovation throughout banking institutions.
The report further indicates that the policy will assist management prioritize risks to ensure that resources and capitals are focused on high priority risks faced by their institutions.