Community Bank and Credit Union Enterprise Risk Management

Establishing and maintaining your community bank and credit union enterprise risk management (ERM) program is more important than ever. Our risk management services deliver a simple, yet comprehensive program.

In today’s fast-paced and complex world, establishing a robust enterprise-wide approach to risk management is crucial for your community bank or credit union. The process spans planning, development, implementation, training, and oversight. It is a critical component for ensuring the safety and soundness of your financial institution.

Malzahn Strategic has extensive experience in community bank and credit union Enterprise Risk Management (ERM) program development. We can guide you and your institution in creating a simple, yet comprehensive ERM program. Our approach integrates all existing components of your ERM program, and incorporates any missing elements, to provide a complete, well-rounded solution.

The Emergence of Enterprise Risk Management

Enterprise Risk Management (ERM) has gained significant importance in community banks and credit unions in recent years. This is due to increased global risks, including cyber security threats and global pandemics. These risks impact financial institutions like yours directly or indirectly.

Those that have an established ERM program are better equipped to navigate the challenging environment and achieve sustainable growth. Adopting ERM best practices ensures that your institution has a solid foundation and infrastructure. It enables your organization to anticipate and prepare for future risks while pursuing your organizational vision.

Our Comprehensive ERM Process

At Malzahn Strategic, we’ve developed a proven process that covers all aspects of risk factors that community banks and credit unions like yours may encounter. Our comprehensive approach includes the following steps:

  1. Risk Assessment Development: We work with your risk management team to develop tailored risk assessments. These assessments consider the unique factors and circumstances that apply to your organization.
  2. Training: We provide training for your risk managers, leaders, or compliance officers, covering risk assessment characteristics and techniques. This helps to ensure that your team has the necessary skills and knowledge to effectively manage risk on an ongoing basis.
  3. Risk Assessment System (RAS) Creation: Based on the risk assessments and training, we build a customized Risk Assessment System (RAS). This system is designed to suit the specific needs of your institution. This system is designed to be user-friendly. It allows your team to easily track, monitor, and report on risk levels and trends.
  4. Scenario Analysis: We work with your staff to explore various risk scenarios. This process builds their knowledge and expertise in assessing and mitigating potential risks. This hands-on approach fosters a deeper understanding of the risks your institution may face. It also helps your team develop practical strategies for addressing them.
  5. Final ERM Program Documentation: Upon completion of the above steps, we compile the final ERM program document. This document includes all the necessary components for a comprehensive risk management strategy. This document is ready for implementation and serves as a roadmap for your institution’s ongoing risk management efforts. It is also ready for insertion into your institution’s strategic plan.

Benefits of Our ERM Program

Our ERM program offers numerous benefits for our community bank and credit union clients, such as:

  1. Improved Risk Management: With a comprehensive ERM program in place, your institution will be better equipped to identify and assess risks. This enables your organization to manage risks effectively. This leads to increased stability, better management systems, improved decision-making, and reduced potential for losses.
  2. Regulatory Compliance: A well-designed ERM program helps your institution stay compliant with regulatory requirements. It also helps maintain a strong relationship with regulators. This can lead to a more favorable examination experience and minimize potential regulatory penalties.
  3. Enhanced Reputation: Demonstrating a commitment to effective risk management helps improve your institution’s reputation among customers, investors, and other stakeholders. This can lead to increased trust, loyalty, and ultimately, growth.
  4. Organizational Resilience: By anticipating and preparing for potential risks, your institution will be more resilient in the face of adversity. This enables you to recover more quickly from setbacks and continue to deliver value to your stakeholders.
  5. Strategic Decision-Making: A strong ERM program enables your institution to make more informed strategic decisions. It takes into account the potential risks and rewards associated with each choice. This leads to better long-term planning and more sustainable growth.
  6. Risk Culture Development: Implementing a comprehensive ERM program helps to foster a strong risk culture within your organization. This ensures that risk management is integrated into the daily operations, vendor management, and decision-making processes at all levels. As a result, it ultimately reduces the likelihood of costly mistakes.
  7. Greater Transparency: A well-implemented ERM program increases transparency within your organization. This makes it easier for stakeholders to understand the risks you face and how they are being managed. This can improve investor confidence and support stakeholder engagement.
  8. Employee Empowerment: Providing training and resources to your risk managers, leaders, and compliance officers empowers them. It allows them to take ownership of risk management within their respective areas. This leads to more proactive risk identification and mitigation efforts, further strengthening your institution’s overall risk management capabilities.
  9. Competitive Advantage: In an increasingly competitive financial services landscape, having a robust ERM program in place is important. It can differentiate your institution from its competitors. This can attract customers, investors, and top talent, contributing to your organization’s long-term success.


In an ever-changing and increasingly risky global environment, having a comprehensive enterprise risk management program is essential. This is especially true for community banks and credit unions. Malzahn Strategic’s expertise and proven process can guide your institution in developing a tailored ERM program. This program meets your specific needs and helps you navigate the challenges of the financial services industry.

With our support, your institution can enjoy many benefits of a robust ERM program. These benefits include improved risk management and regulatory compliance. Your institution’s reputation will be enhanced, and its organizational resilience will be strengthened. By investing in a strong ERM program, you can safeguard the future of your institution and position it for continued success.