When? When should the bank begin asking these questions and considering what AI adoption might look like? Speaking recently on banks’ use of AI, former Acting Comptroller of the Currency Michael Hsu — not someone known for encouraging banks to take cavalier risks — observed that AI is one of the rare technologies for which the risk of falling behind may be at least as great as the risk of moving too quickly. Hsu is not alone in that view. Accordingly, the right time to begin thinking about AI in a deliberate and strategic manner is now. A bank does not need to be first in line to subscribe to Anthropic’s latest cutting-edge model, but the greatest AI-related risk many banks face today is failing to answer the first three questions and, as a result, doing nothing at all. Conclusion As banks begin answering those questions, they do not have to do so without guidance. In February, the U.S. Department of the Treasury, in collaboration with the Cyber Risk Institute and several financial institutions, released the Financial Services AI Risk Management Framework. The framework is currently the federal government’s primary AI resource developed specifically for financial institutions and is intended to help banks evaluate AI adoption, identify risks and implement appropriate controls. It provides a practical tool for institutions seeking to develop a thoughtful, risk-based approach to AI. To access the Financial Services AI Risk Management Framework, scan the QR code. https://cyberriskinstitute.org/ artificial-intelligence-riskmanagement/ The flood of AI-related headlines is unlikely to subside anytime soon. By asking four simple questions — who, what, how and when — community bankers can cut through the noise, approach AI strategically and position their institutions to benefit from the technology, rather than allowing a more nimble competitor to answer those questions first. Kurt Leeper is a partner with Otteson Shapiro LLP in the firm’s Denver office. He represents financial institutions in corporate and securities matters, mergers and acquisitions, regulatory compliance and corporate governance. He regularly advises community banks on strategic transactions, capital raising and evolving regulatory issues, including emerging technologies affecting the banking industry. Earlier in his career, he represented the Securities Investor Protection Corporation in recovery efforts related to the Bernie Madoff Ponzi scheme. He is a Certified Information Privacy Professional for both the United States (CIPP/US) and Europe (CIPP/E). YOUR DEBT PORTFOLIO MAY NOT BE KEPT IN HERE, BUT IT’S STILL AN ASSET They may not be currency, but debt portfolios which include credit card, auto deficiency, overdraft, judgements or commercial and consumer loans definitely have value. We’ll buy your debt portfolio from the last four years, with minimum sizes of $100k on at least ten accounts and no maximums. We’ll even walk you through the sales process to help with compliance and data integrity. To offload your debt portfolio, contact Craig Geisler at cgeisler@cherrywoodenterprises.com or (321) 247-5066. 9 Colorado Banker
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