Chief Risk Officer of Union Bank of Nigeria, Eyitayo Quadri says Integrity remains one of the most critical assets for financial institutions, as failures in character and ethical conduct can expose banks to losses far beyond those captured in conventional risk models.
Quadri, in an article titled “The Asset No Creditor Can Seize,” argued that the greatest risks facing financial institutions often emerge from the conduct of individuals in positions of authority, stressing that strong ethical standards are essential to protecting institutions, customers and the wider economy.
He said while risk management traditionally focuses on market conditions, credit exposure and operational vulnerabilities, the integrity of people entrusted with institutional power could determine whether controls succeed or fail.
According to him, financial institutions must therefore treat integrity as a strategic asset capable of protecting institutional reputation, reducing losses and preserving public trust.
Quadri cited the 2024 global study by the Association of Certified Fraud Examiners (ACFE), which examined 1,921 fraud cases across 138 countries, noting that the higher the position of a fraud perpetrator, the greater the financial loss tends to be.
He also pointed to the finding that close to half of fraud cases were linked to inadequate internal controls or the override of existing controls, highlighting the vulnerability created when senior officials are able to bypass systems designed to prevent misconduct.
The Union Bank executive said the consequences of integrity failures extend beyond direct financial losses to include reputational damage, regulatory sanctions and the erosion of confidence in financial institutions.
He referenced estimates by the Boston Consulting Group that banks globally paid more than $320 billion in fines between 2008 and 2016 for offences including benchmark manipulation, money laundering and the sale of unsuitable financial products.
Quadri also highlighted the impact of fraud on Nigeria’s banking sector, citing figures showing that Nigerian banks lost about ₦52 billion to fraud in 2024.
He noted that staff-linked fraud remained particularly concerning because employees with authorised access could cause significantly greater damage than external perpetrators.
According to him, staff-related fraud cost Nigerian banks ₦3.3 billion in the first quarter of 2025 alone, representing an increase of more than 130 per cent from the preceding quarter despite a decline in the number of cases.
He said the figures demonstrated the need for financial institutions to strengthen internal controls while building organisational cultures that make ethical conduct a shared responsibility.
Quadri stressed that effective risk management should not rely solely on individual integrity, but should institutionalise ethical behaviour through strong governance, effective controls and systems that allow wrongdoing to be identified and challenged regardless of the status of those involved.
He cited the Financial Stability Board’s emphasis on “tone from the top” as a key indicator of a healthy risk culture, while also highlighting the importance of the three-lines-of-defence model in ensuring that senior executives remain subject to appropriate oversight.
The Union Bank executive further identified whistleblowing and employee reporting as critical tools in detecting fraud, citing ACFE data showing that tips account for about 43 per cent of fraud detections, more than internal audit and management review combined.
Quadri said institutions must therefore create environments where employees can raise concerns without fear, arguing that controls without ethical leadership amount to paperwork, while character without controls leaves institutions vulnerable to chance.
He, however, noted that the rebuilding of trust is possible, pointing to the 2026 Edelman Trust Barometer, which placed trust in financial services at 63 per cent globally, representing a 10-percentage-point increase over five years.
According to him, the improvement demonstrates that financial institutions can rebuild confidence when they consistently prioritise responsible conduct and institutional accountability.
Quadri urged professionals in the financial sector to regard their integrity as their most valuable personal and professional asset, noting that titles, positions and authority are temporary, while reputation can determine how an individual and institution are remembered.
He also encouraged young professionals entering the industry to resist pressure to compromise ethical standards, stressing that decisions made early in their careers could shape their reputation and professional standing for decades.
He said the consequences of ethical failures in financial institutions ultimately affect real people, noting that behind financial figures and transactions are families and communities whose livelihoods depend on the integrity of those managing financial resources.
Quadri concluded that effective risk management must go beyond protecting financial balances to protecting public trust, institutional reputation and the lives and livelihoods connected to the financial system.
He said integrity remains an asset that cannot be seized by creditors, erased by market volatility or transferred when an individual leaves office, making the preservation of ethical standards one of the most important responsibilities of financial institutions and their leaders.