CHAPTER 9

The Risks of Outsourcing

Roger Bach

Henyep Investments (UK)

Introduction

Outsourcing is now commonplace among financial institutions and yet it means many different things to different people. Furthermore, despite the rapid increase in the number and value of outsourcing contracts awarded in the last few years, it is not a new phenomenon. In this chapter, the basic premise that drives businesses to outsource will be examined, along with the risks associated with it.

Definition of Outsourcing

For the purposes of this chapter, the definition used by the Joint Forum of the Basel Committee on Banking Supervision in its February 2005 paper, titled Outsourcing in Financial Services, will be adopted as this is the definition that the Financial ...

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