The Norwegian Financial Supervisory Authority (Finanstilsynet) has published an on-site inspection report on SpareBank 1 Nord-Norge’s internal governance and risk management, concluding that the group has a governance framework adapted to its business but with defined areas for improvement. Priorities include earlier and stronger board involvement in work on risk appetite, more balanced reporting of the overall risk profile across material risk types, and more active ownership governance given the group’s extensive holdings in alliance companies. Finanstilsynet expects risk appetite set at group level to be allocated and reported more clearly for material business areas and complemented with qualitative explanations, alongside refinements to risk and compliance reporting to improve consistency and the choice and presentation of indicators. The report also points to the need to further develop the ownership-risk policy, noting that a significant share of the group’s risk exposure sits in subsidiaries and jointly owned alliance entities, and it notes organisational changes effective from 1 January 2025 that separate Credit from Risk Management to strengthen second-line independence. Additional observations cover the chair’s counting of external mandates against regulatory limits, clearer assignment of risk ownership and responsibility for individual risk indicators, and an expectation that internal audit should include reviews of the risk appetite framework and that the board assesses whether internal audit resourcing is sufficient. The bank indicated it will make further changes to the chair’s mandates, enhance qualitative risk appetite descriptions in the next revision of the framework, and further develop ownership governance and compliance reporting; Finanstilsynet also requested that the inspection report be shared with the bank’s auditor.

Original source View in tracker