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FRM Part II · FRM Exam Part II · Digital Resilience and Financial Stability: The Quest for Policy Tools in the Financial Sector

A bank's board reviews its cloud outsourcing arrangement for a critical service. Which provision is most important for supporting operational resilience if the provider fails or the relationship ends?

A tested exit strategy with data portability and defined transition support is most important. It lets the bank restore critical services elsewhere if the provider fails or the contract ends, directly supporting operational resilience, unlike pricing, publicity or revenue-reporting terms.

  1. AA clause permitting the provider to set unilateral price increases
  2. BA tested exit strategy with data portability and defined transition supportCorrect
  3. CA marketing agreement allowing joint publicity of the partnership
  4. DA requirement that the provider reports only annual revenue figures

Explanation

A tested exit strategy with data portability and transition assistance lets the bank recover critical services if the provider fails or terminates. The other options do nothing to preserve continuity of service.

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