Fed’s Bowman Touts AI Benefits, Risks for Bank Cybersecurity

Federal Reserve Vice Chair for Supervision Michelle Bowman warned banks on Sept. 29 to buffer their systems against artificial intelligence threats while emphasizing the technology can benefit lenders. “AI offers great potential — both to threat actors and those buttressing their defenses to those threats,” Bowman said in prepared remarks for an event in Colorado. “AI is becoming a critical component of these security measures as both a defensive tool and an evolving risk.” Bowman previously said the Fed should “not micromanage” banks on issues like AI as US officials weigh the impact of the rapidly evolving technology. Bloomberg reported earlier this year that regulators were pausing some cyber-related examinations to give banks time to bolster their systems against threats exposed by the latest AI models. “Defending against these risks begins with strong cyber hygiene — up-to-date asset inventories, phishing-resistant multifactor authentication, strong identity and access controls, and robust vulnerability identification and patch management programs,” said Bowman. The Fed’s top bank cop also said although cybersecurity requires proactive risk management by bank boards of directors and senior management, regulators recognize that preparing for such threats can be burdensome and challenging for community banks. “That’s why we continue to tailor our approach to IT examinations to consider risk profile and emerging threats and risks,” she said. Photo: Michelle Bowman, vice chair for supervision at the US Federal Reserve. Photographer: Eric Lee/Bloomberg Topics InsurTech Data Driven Artificial Intelligence Cyber Was this article valuable? Thank you! Please tell us what we can do to improve this article. Thank you! % of people found this article valuable. Please tell us what you liked about it. Here are more articles you may enjoy.