OCC issues first guidance for examiners on reviewing banks' AI use

The Office of the Comptroller of the Currency issued guidance on Wednesday, Nov. 4, that it said is its first for how examiners should probe banks' use of artificial intelligence, according to a copy of the document seen by Reuters.1

The sources do not give the OCC's stated reason for issuing the guidance; Reuters reported that banking regulators worldwide have been querying lenders about AI use, worried it poses cybersecurity and potentially financial stability risks.1 The framework was first reported by Reuters, and the source is Reuters' account of the document, not the OCC document itself.1

Under the framework, the OCC says banks are not expected to set up separate risk parameters for AI use, and examiners should not treat the technology as a unique risk.1

Examiners should consider how a lender is using AI, as well as the lender's size and complexity, according to Reuters' description of the document.1

The OCC said examiners should focus on the consequences of potential AI-driven mistakes rather than the sophistication of particular models; as an example, it said a simple AI agent authorized to initiate transactions could be considered riskier than a sophisticated model deployed for internal purposes.1

The document said higher-risk uses of AI may require greater restrictions on autonomy or more direct human oversight; Reuters noted the guidance is not legally binding like a rule, though banks typically comply closely with such guidance.1