A bank’s ability to detect financial risk is driven primarily by its internal risk culture.

Carolyn DuChene, deputy comptroller for operational risk with the Office of the Comptroller of the Currency, made this assessment before the American Bankers Association’s risk management forum.

The key to keeping a firm safe is establishing a strong risk management framework while constantly assessing how much capital and liquidity you hold, DuChene noted.

Risk culture is comprised of five elements: enterprise, ethics, education and expertise, empowered and engaged employees and executive expectations.

After the crash in the market, DuChene took all the lessons she learned and comprised the above list to help improve the industry.

“The establishment and cultivation of a risk culture is, in the end, all about good stewardship, and the recognition that a firm and its reputation prosper across the economic cycles when the human element is in sync with the risk management environment,” said DuChene.