The Conference of State Bank Supervisors released an optional framework for examining artificial-intelligence use at financial institutions. The tool helps state examiners identify AI applications, assess related risks and decide when deeper review may be appropriate. It is not a binding nationwide rule.
The framework covers state-chartered banks and state-licensed financial institutions within participating regulators’ remit. Each state agency will decide whether and how to incorporate it into its supervisory programme. Independent banking-sector reporting confirmed the framework’s discretionary status and examination focus.
EXAMINERS RECEIVE A RISK-BASED TOOLKIT
The core guide includes scoping questions, document requests and procedures for reviewing governance, oversight, AI inventories and use cases. It also addresses generative AI and emerging applications, while a separate work programme provides more detailed examination steps.
Additional materials cover nonbank risks involving third parties, vendors, models and consumer protection. An optional worksheet allows examiners to rank individual AI use cases and determine where more extensive review may be warranted.
STATE ADOPTION WILL DETERMINE PRACTICAL REACH
Financial institutions can also use the framework to test their own governance and risk-management arrangements before examinations. Its design accounts for differences in an institution’s size, complexity, risk profile and actual use of AI.
The next milestone is adoption or adaptation by individual state regulators. Banks and nonbanks should monitor local supervisory programmes because examination expectations may differ by jurisdiction even where agencies draw on the same CSBS materials.