Third-Party Risk Management: Cybersecurity Staffing Strategies for Banks

Third-party risk has evolved from compliance checkbox to existential concern. With 30% of breaches now involving third-party compromise—double the rate from the prior year—and incidents like the Marquis Software Solutions ransomware attack cascading across hundreds of community banks, dedicated bank third party risk cybersecurity staffing has become essential rather than optional.

Regulatory pressure compounds the urgency. The June 2023 Interagency Guidance from the Fed, FDIC, and OCC established comprehensive TPRM requirements, followed by specific guidance for community banks in May 2024. Meanwhile, 90% of organizations now view TPRM as a growing priority, yet most programs manage more vendors with the same or fewer staff than previous years. This guide covers the roles, skills, and staffing models banks need for effective third-party risk management.

The Regulatory Landscape Driving TPRM Hiring

Multiple regulatory frameworks now mandate formal third-party risk management programs with appropriate staffing. Banks face examination scrutiny on vendor oversight regardless of institution size.

The regulatory message is clear: banks must demonstrate appropriate vendor oversight proportional to risk. Examiners evaluate whether institutions have qualified staff—or qualified service providers—managing third-party relationships. Inadequate TPRM staffing increasingly results in examination findings requiring remediation.

TPRM Roles in Banking Cybersecurity

Third-party risk management spans multiple specialized roles, from hands-on vendor assessors to strategic program leaders. Role requirements vary by bank size and program maturity.

The number of TPRM programs managing 250+ vendors has nearly doubled since 2020, yet staffing hasn't kept pace. Banks with extensive vendor portfolios often need multiple assessors plus program leadership to maintain adequate oversight without creating bottlenecks that slow business operations.

See complete salary data for banking cybersecurity roles

Skills and Qualifications

TPRM roles require a unique blend of technical security knowledge and business acumen. Effective TPRM professionals translate security findings into business risk language while negotiating with vendors and communicating with executives.

Valuable Certifications

While no single certification defines TPRM competency, several demonstrate relevant expertise. CTPRP (Certified Third Party Risk Professional) focuses specifically on vendor risk management. CRISC (Certified in Risk and Information Systems Control) demonstrates broader risk management capability. CISA provides audit and assessment skills valuable for vendor evaluations. CISSP offers foundational security knowledge for technical assessment work.

Learn which certifications matter for banking cybersecurity roles

Staffing Models by Bank Size

TPRM staffing scales with institution size, vendor count, and risk complexity. Regulators expect proportional oversight—not identical programs regardless of bank size.

Community banks often struggle most with TPRM staffing—they face the same regulatory expectations as larger institutions but lack resources for dedicated teams. The May 2024 Community Bank TPRM Guide acknowledges this reality, encouraging collaborative arrangements and scaled approaches that don't require full-time specialists.

Building vs. Buying TPRM Capability

Banks face a fundamental choice: build internal TPRM teams or leverage external services. Most institutions land on hybrid approaches combining internal coordination with external assessment capacity.

When to Build Internal Teams

Dedicated internal staff makes sense when vendor portfolios exceed 200+ relationships, when critical vendors require deep ongoing relationships, or when examination frequency demands continuous documentation and rapid response. Internal teams develop institutional knowledge about vendor relationships and business context that external assessors lack.

When to Buy External Services

TPRM-as-a-service works well for community banks lacking scale for dedicated staff, for handling assessment backlogs without permanent headcount, or for specialized assessments (penetration testing, cloud security reviews) requiring expertise beyond internal capabilities. External services also provide surge capacity during examination preparation or major vendor onboarding initiatives.

Hybrid Models

Most effective programs combine internal TPRM coordinators managing vendor relationships and regulatory communication with external assessment services executing technical evaluations. This approach provides business continuity and institutional knowledge internally while accessing specialized assessment expertise externally without maintaining rarely-used technical skills in-house.

See how community banks balance internal and external security resources

Frequently Asked Questions

How many TPRM staff do we actually need?

A common benchmark: one full-time TPRM professional per 100-150 vendors requiring active oversight (critical and high-risk tiers). Community banks with 75 critical/high-risk vendors might need 0.5-1 FTE, while regional banks with 300 such vendors need 2-3 staff. Factor in assessment frequency—annual assessments for critical vendors, biennial for moderate risk—to calculate actual workload.

Can we combine TPRM with other security functions?

Yes, particularly at smaller institutions. TPRM often combines with GRC (governance, risk, compliance) roles or reports to security leadership wearing multiple hats. However, dedicated focus improves program quality. As vendor counts grow and regulatory scrutiny intensifies, separating TPRM from other responsibilities becomes increasingly important.

What's the biggest TPRM hiring challenge?

Finding candidates who combine technical assessment capability with business communication skills. Many technically strong assessors struggle to translate findings into business risk language or negotiate effectively with vendors. Conversely, relationship-focused professionals may lack depth to evaluate SOC 2 reports or cloud security configurations meaningfully. Screen for both skill sets.

Should TPRM report to security or risk management?

Either can work depending on organizational structure. TPRM increasingly reports to CISO organizations given the security-centric nature of vendor risk. However, some banks place TPRM under enterprise risk management for broader risk integration. What matters more than reporting line: ensuring TPRM has authority to block or condition vendor relationships based on security findings, and direct access to executives when critical vendor risks emerge.

Strategic TPRM Staffing for Modern Banking

Third-party risk management has evolved from periodic vendor reviews to continuous oversight programs requiring dedicated expertise. With 30% of breaches involving third parties and regulatory expectations intensifying, banks can no longer treat TPRM as a part-time responsibility distributed across already-stretched security teams.

The right staffing model depends on your institution's size, vendor complexity, and risk tolerance. Community banks may thrive with hybrid models combining internal coordination and external services. Larger institutions need dedicated teams scaled to vendor portfolios. Regardless of model, the key is ensuring adequate qualified resources—whether employed directly or engaged through services—to maintain vendor oversight that satisfies both security requirements and regulatory expectations.