The Federal Reserve Bank of Chicago's supervision group follows current and emerging risk trends on an ongoing basis. This Risk Perspectives newsletter is designed to highlight a few current risk topics and some potential risk topics on the horizon for the Seventh District and its supervised financial institutions. The newsletter is not intended as an exhaustive list of the current or potential risk topics and should not be relied upon as such. We encourage each of our supervised financial institutions to remain informed about current and potential risks to its institution.
Current Risk Topics
- Commercial Real Estate: Strong market fundamentals, coupled with the abundance of capital to pursue investment opportunities have continued to fuel growth in commercial real estate portfolios.
- Commercial and Industrial Lending: Corporate borrowers are acting upon positive signs in the US economy. Small business’ outlook on the U.S. economy is on the rise.
- Chicago's Debt Downgrade: Headlines have drawn much attention to issuers of municipal debt in the Chicagoland area. Specifically the City of Chicago was downgraded to junk bond status by Moody’s Investor Services in May of this year.
- Cyber Insurance: With the increase in cyber-related incidents including nation-state sponsored attacks against the financial sector, cyber insurance has become a more attractive option for financial institutions looking to mitigate their potential cyber related exposures.
- U.S. Migrates to EMV Chip Card and Prepares for October 1, 2015 Counterfeit Card Liability Shift: After a record breaking year for data breaches and increases in credit card fraud, the United States is moving away from magnetic strip technology and migrating to EMV (Europay, Mastercard and Visa) chip cards.