Artificial Intelligence and Bank Soundness: A Done Deal? - Part 1

Charmele Ayadurai, Sina Joneidy

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract

Banks soundness plays a crucial role in determining economic prosperity. As such, banks are under intense scrutiny to make wise decisions that enhances bank stability. Artificial Intelligence (AI) plays a significant role in changing the way banks operate and service their customers. Banks are becoming more modern and relevant in people’s life as a result. The most significant contribution of AI is it provides a lifeline for bank’s survival. The chapter provides a taxonomy of bank soundness in the face of AI through the lens of CAMELS where C (Capital), A(Asset), M(Management), E(Earnings), L(Liquidity), S(Sensitivity). The taxonomy partitions opportunities from the main strand of CAMELS into distinct categories of 1 (C), 6(A), 17(M), 16 (E), 3(L), 6(S). It is highly evident that banks will soon extinct if they do not embed AI into their operations. As such, AI is a done deal for banks. Yet will AI contribute to bank soundness remains to be seen.
Original languageEnglish
Title of host publicationOperations Management - Emerging Trend in the Digital Era
EditorsAntonella Petrillo, Fabio De Felice, Germano Lambert-Torres, Erik Bonaldi
PublisherIntechOpen publisher
ISBN (Electronic)9781838812034
ISBN (Print)9781838811877
DOIs
Publication statusPublished - 28 Jan 2021

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