Federal Reserve Vice Chair for Supervision Michelle Bowman said supervision and regulation regarding the use of artificial intelligence should be based on a bank’s size and level of risk.
Details: Speaking at a Financial Stability Board event on its Sound Practices for Responsible Adoption of Artificial Intelligence report, Bowman said the Fed is focused on promoting innovation at financial institutions of all sizes, not just the largest ones. “What works or is a consideration for larger institutions using AI in complex applications is not appropriate for smaller institutions with less complex AI uses,” she added.
ICBA AI Efforts:
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In a statement for the record for a Senate Banking Committee hearing on “AI and the American Dream,” ICBA last month urged senators to ensure recognition of the critical role played by community banks as Congress and federal agencies develop new AI policies.
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After President Donald Trump’s recent executive order on AI recognized community banks as a critical infrastructure component, ICBA said it hopes this results in equitable access to federal AI security resources and coordination.
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ICBA formed an AI Task Force to provide practical guidance for community bankers.
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ICBA released the Community Banker AI Security Readiness Guide to assess the AI threat shift, what it means for local institutions, and how to strengthen third-party due diligence, update and test incident response plans, among other topics.
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ICBA hosted a complimentary webinar on its AI Security Readiness Guide.
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ICBA led development of a Joint AI Action Plan to urge immediate federal action to prepare for a new era of AI-enabled cybersecurity risk.