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MODEL RISK MANAGEMENT 
IN THE AGE OF AI

Are existing model risk management programs still "fit for purpose" in the age of AI?

While most Banks have evolved their model risk management programs to be consistent with the 2011 bank supervisory guidance (OCC 2011-12 and SR 11-7), there is still debate as to whether these programs remain “fit for purpose” given the rise of AI / ML methodologies.
 
In this primer, I directly address this "fit for purpose" question by performing a deep dive risk assessment of current AI / ML methodologies and development technologies, and overlaying the corresponding risks onto our existing model risk management framework.

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