> Let me explain what I mean. After a quick google: What is a Chief risk officer? ... That's all cost-center stuff, none of that has anything to do with the banking line of business.

This is hilarious. Next time, at least try asking ChatGPT instead of Google before becoming an expert on something new and explaining it to others on the Internet.

What you read is the CRO job description for a CRO of any corporation. All large corporations have CROs, and the CRO is responsible for the risks that all corporations have (security, insurance, etc). A bank CRO's job description includes all of that plus the banking risks, such as credit risk, capital markets risk and liquidity risk. A bank run, in particular, is a negative result of liquidity risk.

the rest of my point is the same, if a bank has a chief risk officer, it's the President of the bank, or an EVP. There are quants who track, measure and calculate financial risk, but that's a line responsibility, they're not chiefs. If you want to call the President of a "financial risk banking company" the chief of something, he's CEO, not CRO, even though risk management is his main job.

I think what OP is trying to say is that just because there is no CRO, doesn’t mean there is nobody that cares about risk. It’s a red herring.

If the CRO left, the whole organisation under and above him didn’t suddenly disappear. Chances are they have a top lieutenant that knows as much if not more of the actual risk than the CRO.

I'd fire the CRO if I was tired of their shit too.

Or one might fire the CRO if they are tired of their incessant, daily nagging that the entire business it at risk and that we need to make sweeping changes that are going to negatively affect next quarter profitability.

under and above her, unless he's a man named laura

As much as I agree with you about the silliness of the C-suite, the job of "head of risk" is an important position at a bank because they:

1. Keep people hired for their greed honest (in terms of creating their models), and

2. Keep track of "soft" risks that can't be tracked by models well and tail risk that is underpriced by models (ie keep track of the nebulous concept of "modeling risk").

In opposition to the rest of the senior executives - who encourage greed and actively ignorance of "soft" risks to make more money.

Everyone knows if there's not a Chief Custodial Officer, the bathrooms won't get cleaned.

Not only a CCO, but a Director of Privies and Urinals. When it comes to busy bathrooms, head-count is important.

Counterpoint: without a dedicated person in charge of this, responsibility will be diffused among the organization and everyone will assume someone else is taking care of it

The buck does not stop with the CEO, it stops with the company’s board, who represent investors and who the CEO answers to. The CRO often reports to the board and at the very least, communicates directly with them.

The reason for the role of CRO is that the CEO, CFO and other C suite executives are not really aligned with investors incentive-wise. If the bank does really well, the CEO gets huge bonuses. If the bank crashes, the CEO gets fired but typically doesn’t lose all their money like investors do. Hence the need for the board’s function in risk management and a CRO to help them with that. In a bank, the risks are unique and often hard to see which is why risk management is often a huge department.

None of this exonerates the CEO. Of course they are to blame when things go wrong. But when financial risk is a huge part of a business, it’s good to have some backup for that role as well.

I'd love to know whose on the board of SVB. Is it leadership from other companies that were SVB customers?

Signature bank, which also collapsed last week, had Barney frank (of Dodd-Frank banking regulation) on its board.

Life doesn't get any better.

If your organization is designed to have a C-level official to manage things like internal audit, and that job is vacant for an extended period, it’s unlikely that the VP of Audit has the political capital to be heard.

The shitshow around this bank is a case study for poor or no internal controls.

The regulators allow mark-to-maturity on underwater bonds. When do the regulators wake up and set more reasonable rules?

It’s not particularly relevant. Regulators aren’t there to ensure that soft bumpers are in place for companies like a kiddie bowling alley.

LOL. You want same person to be responsible for quarterly profits, long term investments and risks assessment. And than will act surprised when it crashes.

No such thing as a cost center in business. It is an idea that comes from “C-suite nonsense”. Either someone provides marginal value above their marginal cost or they don’t.