Technology and Fraud identified as top risks by both banks and insurers
Eastern Africa survey ranks risks among financial services providers
13 April 2011, Nairobi
PwC today launched a new survey report detailing the risks faced by banks and insurance companies in eastern Africa. High dependence on technology was ranked highest among the risks by banks while insurers battle with Industry reputation. The other top risks ranked by banks are fraud, competition, credit risk and the quality of risk management, while the top risks for insurers are accuracy of actuarial assumptions, managing the pricing cycle, fraud and investment performance.
‘Based on the survey results, bankers feel a rising level of anxiety from the top three risks they are currently facing, while insurers feel that most risks have remained steady in terms of severity,’ commented Richard Njoroge, Head of Financial Services at PwC Kenya and one of the report’s co-authors. ‘Both banks and insurers feel a ‘mixed’ sense of preparedness to the risks they are currently facing.’
‘In Kenya, responses indicate that risks are increasing in complexity as the market for financial services increases in sophistication,’ said Kang’e Saiti, a partner in the Financial services group with PwC Kenya and the report’s other co-author. ‘We can learn a lot about what is coming around the corner in Kenya by looking at this evolving perception of risk, and also by comparing Kenya to other markets in eastern Africa and markets globally where there might be a different mix of risks.’
Findings from the risk survey include: