Devendra Singh
Law
August 2024
Artificial Intelligence (AI) is radically improving the assessment and management of financial risks, which is changing risk management in the banking industry. Banks are using artificial intelligence (AI) more and more to improve their risk management plans in the areas of credit, operations, and liquidity because they are intermediaries and bear inherent risks. The impact of AI on banking risk evaluation is summed up in this abstract, which emphasises how it may enhance operational risk management, strengthen liquidity management, and improve credit risk assessment through real-time forecasting and advanced data analytics. AI presents a number of obstacles, including model interpretability, issues with data quality, and the requirement for a strong risk culture, even while it offers significant advantages in terms of risk assessment, quantification, and monitoring. In order to preserve resilience in the face of changing financial conditions, increase shareholder value, and attain a balanced approach to risk and reward, banks must include artificial intelligence (AI) into risk management. The revolutionary potential of AI in improving risk management procedures is emphasised in this abstract, as is its crucial role in the future of banking.
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© Airo Journals 2021
