Featured Product

    HKMA Outlines Principles for Application of Artificial Intelligence

    November 06, 2019

    HKMA sets out the high-level principles on the use of artificial intelligence based on sound industry practices and similar principles formulated by the leading overseas authorities. These principles have been set out in a recent letter that was issued to the Chief Executives of all authorized institutions. Banks are expected to take these principles into account when designing and adopting their artificial intelligence and big data analytics applications.

    The twelve principles cover aspects related to governance, application design and development, and ongoing monitoring and maintenance. The principles convey the importance of using data of good quality, conducting rigorous model validation, ensuring an appropriate level of explainability of artificial intelligence applications, ensuring auditability of artificial intelligence applications, implementing effective management oversight of third-party vendors, and implementing effective cyber-security measures. Banks may apply the principles in a proportionate manner that reflects the nature of their artificial intelligence applications and the level of risks involved. As international regulatory standards and industry developments regarding the use of artificial intelligence are evolving rapidly, HKMA will keep these principles under periodic review and provide further guidance to banks as and when appropriate. HKMA plans to issue a  separate guidance on the principles relating to consumer protection aspects involved in the use of artificial intelligence applications.

    HKMA also conducted a survey, in the third quarter of 2019, on the use of artificial intelligence by banks. It is noted that many banks are adopting or planning to adopt artificial intelligence applications. The scope of the use of artificial intelligence is also expanding from customer-facing services (for example, chatbots and personalized marketing) to internal processes and risk management areas (for example, operational automation, cyber risk, and fraud risk management). Details of the survey results will be published soon.

    Keywords: Asia Pacific, Banking, Artificial Intelligence, Big Data, Fintech, Guidance, Cyber Risk, HKMA

    Related Articles
    News

    BoE Clarifies Approach to Treatment of Payment Holidays on Form PL

    BoE published a statistical notice (Notice 2020/9) explaining the approach for treatment of payment holidays on the profit and loss return or Form PL.

    August 11, 2020 WebPage Regulatory News
    News

    BoE Provides Reporting Update on Form AS and Form FV

    BoE updated the known issues document for the statistical reporting Forms AS and FV.

    August 10, 2020 WebPage Regulatory News
    News

    FED Announces Capital Requirements for Large Banks

    FED announced individual capital requirements for 34 large banks and these requirements go into effect on October 01, 2020.

    August 10, 2020 WebPage Regulatory News
    News

    SRB Publishes Guidance on Implementation of Bail-In Tool

    SRB published a set of documents to give operational guidance to banks on implementation of the bail-in tool.

    August 10, 2020 WebPage Regulatory News
    News

    BIS Publishes Update on G20 TechSprint Initiative

    BIS published an update on the G20 TechSprint Initiative, which was launched in April 2020 and aims to highlight the potential for technologies to resolve regulatory compliance (regtech) and supervisory (suptech) challenges.

    August 10, 2020 WebPage Regulatory News
    News

    OSFI Provides Update on Implementation of IFRS 17 in Canada

    OSFI published a letter that provides an update on the milestones for the implementation of the IFRS 17 standard on insurance contracts.

    August 07, 2020 WebPage Regulatory News
    News

    EBA Provides Clarity on Implementation of Guidance on COVID Reporting

    EBA updated the report on the implementation of selected COVID-19 policies.

    August 07, 2020 WebPage Regulatory News
    News

    FSI Note Discusses Challenges Associated with COVID Relief Measures

    The Financial Stability Institute (FSI) of BIS published a brief note that examines the supervisory challenges associated with certain temporary regulatory relief measures introduced by BCBS and prudential authorities in response to the COVID-19 pandemic.

    August 06, 2020 WebPage Regulatory News
    News

    BCBS Consults on Principles for Operational Risk and Resilience

    BCBS is consulting on the principles for operational resilience and the revisions to the principles for sound management of operational risk for banks.

    August 06, 2020 WebPage Regulatory News
    News

    BoE Updates Template and Definitions for Form ER

    BoE updated the reporting template for Form ER as well as the Form ER definitions, which contain guidance on the methodology to be used in calculating annualized interest rates.

    August 05, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5650