Hafsteinn can you please give the Center for Financial Professionals’ audience an overview of your individual background and professional experience?
My first degree was a Bachelor degree in Industrial Engineering and my professional career started as a quality inspector in construction. With banking booming, particularly in Iceland, my interest turned to finance and I completed my Masters in International Economics and Finance at Newcastle University Business School in the UK.
My first role in banking was in September 2008 within a newly formed Operational Risk team at an Icelandic Bank named Glitnir. My experience in quality control as well as my finance education made me a good candidate for a newly formed Operational Risk team. Glitnir was nationalized 29 days later. The Operational risk team for different reasons shrank significantly and gave me the unique opportunity to build out an Operational Risk framework at the newly formed Islandsbanki.
At Islandsbanki, I participated in numerous activities in a bank re-established from the domestic remains of Glitnir with a very strong emphasis on risk management, completed the FRM designation and put my focus on the value add of Operational Risk programs and my developing expertise.
In 2014, I relocated to the US and got a position at CIT in Enterprise Operational Risk where I have managed numerous parts of the Operational Risk framework (e.g. Loss Reporting, RCSA’s, CCAR, Capital Model) and assisted in the build out of risk activities.
At the 2nd Annual New Generation Operational Risk Congress (October 25-26), you discussed using Op Risk and ERM collectively, why do you think this is a key discussion point for these teams to be aligned?
Operational Risk is an integral part of ERM and the various risk functions at financial institutions have a direct and indirect relationship with Operational Risk. The two will look to merge rather than grow apart, especially from the view of the first line of defence. Operational Risk has to open up our framework to be inclusive of other risk functions, and identify opportunities for them to operate using the methodologies of Operational Risk.