The Way to Equitable AI

Moving far ahead of the banking agencies AI, FHFA today released a series of supervisory AI/ML standards for Fannie, Freddie, and CSS, perhaps leaving the FHLBs alone because none so far does much within this arena or nobody cared.  Reflecting the agency’s new equality and equity mission GSE, the AI/ML standards focus not only on risk management, but also ethical deployment in ways sure to set complex new AI/ML entry hurdles for the GSEs.  If they surpass them, then a new U.S. AI/ML construct will result; if not, Fannie and Freddie could fall behind this all-important efficiency curve.