RISK ASSESSMENT OF COMMERCIAL BANKS AS ENTITIES OF PRIMARY FINANCIAL MONITORING

Abstract

The article examines the main risks of commercial banks as subjects of primary financial monitoring. In particular, the essence of a “suspicious financial transaction” in the implementation of a bank’s financial monitoring is examined. The main sources of regulatory risk assessment in the implementation of bank financial monitoring are highlighted. The main sources include statistical and administrative reporting; results of assessments by the State Financial Monitoring Service; results of court decisions and reports by the European Commission. The results of sectoral risks of subjects of primary financial monitoring are examined. It was found that banks have an average level of acceptable risk according to the criterion of “laundering of funds obtained by criminal means” and a low level according to the criterion of “financing of terrorism”. The highest level of risks according to the results of financial monitoring was found for transactions of funds transfers by non-bank financial institutions, the real estate market, the audit services sector and the lottery (gambling) sector. A high level of risk regarding financing of terrorism was not recorded. The European experience of risk assessment is studied using the example of a commercial bank, Raiffeisen Bank International. The methodology for assessing the risks of bank activities when carrying out financial monitoring is identified. An example of a cyclical model of risk assessment of a European bank is demonstrated. The model has six key stages, Fig. 2. Strategic directions for minimizing bank risks and improving financial monitoring are formulated, for example: 1. conducting timely internal and external audits of banking results, in particular regarding compliance with the Basel Principles; 2. using a risk-oriented approach (focus on high-risk clients, products, financial transactions); 3. systematic testing of bank employees for knowledge of legislation, in particular the head and employees of the bank's financial monitoring department; 4. improving internal financial reporting, in accordance with the requirements of International Financial Reporting Standards; 5. clarity of products, in particular software products, of a commercial bank - for users and clients. Conclusions are drawn.