Associated Bancorp affiliate provides compliance services for smaller banks

Last updated on May 13th, 2019 at 02:42 pm

Associated Risk Group, a new affiliate of Green Bay-based Associated Bancorp, offers compliance-related services and guidance for financial institutions with up to $15 billion in assets. Associated Bancorp also owns Associated Bank, which has branches in  Wisconsin, Minnesota and Illinois and about $20.5 billion in assets.

The company’s risk group, started in July, helps banks, credit unions, savings associations, loan and finance companies, real estate professionals, insurance companies and other firms that deal in financial matters, navigate through federal and state requirements for reporting earnings, assets and financial statements.

Many financial institutions can’t afford their own compliance departments, said Ryan Rasske, president of Associated Risk Group. Many smaller banks and other financial institutions in southeastern Wisconsin use outside consultants and accountants for compliance matters.

Federal oversight of financial institutions has greatly increased since the Sept. 11, 2001 terrorist attacks and corporate scandals of the late 1990s and early 2000s, Rasske said. Associated Risk Group aims to help small and medium-sized financial institutions meet the new requirements.

Because Associated Bank was already dealing with many compliance issues itself, its holding company felt the bank could offer smaller community banks the best compliance advice.

“Associated Bank has had tremendous success in building its own in-house compliance program,” Rasske said. “We saw an opportunity to duplicate our own programs and share them with other financial institutions. We feel that because we’re so closely tied to a bank that we can give real-time knowledge because we’re doing it (compliance work) at the same time they are.”

Associated Bank still uses its own in-house compliance department. Although the bank does not use Associated Risk Group for compliance matters, the two companies routinely meet to talk about changes in federal compliance guidelines and share best practices.

“There is constant training that goes back and forth between the bank and risk group,” Rasske said. “Even though we’re not working with them as a client, we encourage open networking between the two to make sure each side is on the leading edge, sharing ideas and experiences as we’re going forward.”

Associated Risk Group has three compliance consultants. Raaske oversees the group, does some compliance work for clients and also does work in Associated Bank’s anti money laundering department. The risk group will be adding more consultants this year, he said. The number of new consultants depends on the amount of new business it gets.

While that number is not known, there’s a great growth potential for the risk group because of increasing reporting requirements.

“The big thing now is risk assessment – every institution is required to do one and identify risk areas,” he said. “We’re constantly changing that model and making sure it meets and exceeds regulators’ expectations. We see it becoming a key area (for financial institutions) and (Associated Risk Group) becoming a leader in that market.”

Additionally, financial institutions that deal with money transfers and precious metals will face increased scrutiny by the Internal Revenue Service and other federal agencies in coming years, Rasske said.

“The money transmitters are two to three years behind where the banks are,” Rasske said. “We want to grow in non-bank clients as well. We want to get into money service, insurance and precious metals and become a leader there as well.”

Although Associated Risk Group has only three consultants, the firm is able to act like a larger firm because it can leverage the legal, marketing and other departments that work for Associated Bancorp’s other divisions, Rasske said.

“Anyone starting (this company) on their own would have to start from ground zero,” he said. “We’re able to leverage all of the experience and funding that already existed within the bank.”

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