Banks face a more uncertain environment amid the war in Ukraine and need to shore up their risk management programs to gird against multiple negative scenarios unfolding at once, a top US banking regulator said.

So-called tail risks — unlikely but highly impactful risk events — are a growing potential issue that financial institutions’ risk departments need to grapple with, Michael Hsu, acting comptroller of the currency, said on 31 March at a conference hosted by the American Bankers Association.