IMF: More Work Needed to End Too-Big-to-Fail Banks

In a blog post today, the IMF stated that progress is required to put an end to too-big-to-fail banks following last year’s bank failures.  The Tobias Adrian post cites the need for more “intrusive” supervisory action, noting that last year’s failed US banks were allowed to pursue risky strategies without proper risk-management procedures.  The post calls for improved liquidity support for banks approaching resolution, also concluding that smaller banks may pose systemic risks.

SEC Sets AI-Use Standards via New Enforcement Action

Although actual fines are small, the SEC’s enforcement action today countering “AI washing” is not just aimed at investment advisers touting AI as their guide to investment choice either for their own actions or those of their customers.  The standard also applies to other financial entities (e.g., broker-dealers) and – with still greater effect – to public-company filings related to AI and machine learning both in terms of firm focus and products offered.  Both advisers targeted by the order were also charged with violations of SEC marketing and other standards.