Butterfield Bank has learned its lessons from the huge losses it suffered in the wake of the global financial crisis and is working hard to show stakeholders that it has changed for the better.That is the message from the bank's new chief risk officer Daniel Frumkin, a 24-year banking industry veteran, who said the bank's revamped management team was made up of very capable people and he saw opportunities for the group to return to strong profitability.Butterfield suffered losses running into the hundreds of millions of dollars after the US mortgage-linked securities that featured heavily in its investment portfolio plummeted in value during the property slump.After a cash injection of more than half a billion dollars in March last year from a group of mainly overseas investors, the bank was able to sell off the vast majority of its troubled assets and get back on an even keel.Mr Frumkin said there was now a much greater awareness of risk across the banking sector, encouraged by more demanding regulation, and the process of recovering the trust of stakeholders was under way.“Clearly all the banks have to rebuild trust,” Mr Frumkin said. “We have to work hard to convince our customers, shareholders and board of directors that we fundamentally understand why we went wrong.“In our case, it's not particularly complicated. The lessons were easy to learn and it's a very different organisation today than it was a few years ago. That is not to say that decisions made in the past were right or wrong.“The same things that happened to Butterfield Bank also happened at Bank of America, Citigroup, RBS and many other banks around the world. This bank was not alone in making decisions that, with hindsight, look very short-sighted.”In the role he took on from December 20, Mr Frumkin will have overall responsibility for the group's enterprise risk management framework, including the functions that monitor and control the bank's credit, operational, compliance and market risks. He also sees reputational risk as “overarching” in that problems related to any of the basic elements of risk can damage the bank's standing with customers and erode trust.Butterfield is a bank where “risk has a voice”, he said. He will consult regularly with the board of directors, as well as with other members of senior management, to ensure there is awareness of the risks the bank takes, equipping them with the facts they need to make informed decisions.Mr Frumkin knows a thing or two about banking risk. He worked for 21 years with the Royal Bank of Scotland Group in the US and the UK, including a spell as chief risk officer, retail banking, where he was in charge of 1,250 risk professionals. He later served as managing director of RBS UK Retail Products Group, responsible for the profitability of 2,200 branches with more than 14 million customers.After leaving RBS, he was appointed head of transition risk at Northern Rock, as the UK lender was restructured under public ownership after almost folding during the crisis. He also served as chief restructuring officer at a recently nationalised Latvian bank, JSC Parex banka.RBS was one of the worst-hit UK banks during the crisis and received a bailout totalling £45.5 billion (around $70 billion), reportedly the biggest bailout of any bank in the world. Mr Frumkin said the over-leveraging on the RBS balance sheet was largely related to huge financing deals, rather than the retail banking operations for which he was responsible.Mortgage and loan delinquencies actually went down during the crisis at RBS, Mr Frumkin said. He said the abuse that many employees at the bank suffered at the time things unravelled had been unjustified.“There were 32,000 employees in RBS's retail banking operation,” Mr Frumkin said. “Of those, the number of people who had any real input into the things that caused the problems was probably one. There were 31,999 employees who just wanted to do a good job and who should not be blamed at all.“Similarly, at Butterfield Bank, the number of employees who had any direct influence on what happened, you could probably count on two hands.”Since the unfolding of Butterfield's problems, virtually the entire senior management team has been replaced. Mr Frumkin is the latest addition to the new-look team led by chief executive officer Brad Kopp.Mr Frumkin said he turned down other job offers to join Butterfield, because he is bullish about the bank's prospects.“Butterfield Bank is a good, strong brand,” he said. “The new leadership team is solid and they know banking inside out. I think we can build a strong, well managed and very profitable institution. The balance sheet is strong and our regulatory capital is more than twice the regulator's requirements.“I think we are poised to deliver better results.”