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

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.

Artificial Intelligence and Bank Soundness: Between the Devil and the Deep Blue Sea - Part 2

Banks have experienced chronic weaknesses as well as frequent crisis over the years. As bank failures are costly and affect global economies, banks are constantly under intense scrutiny by regulators. This makes banks the most highly regulated industry in the world today. As banks grow into the 21st century framework, banks are in need to embrace Artificial Intelligence (AI) to not only to provide personalized world class service to its large database of customers but most importantly to survive. 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 challenges from the main strand of CAMELS into distinct categories of AI into 1(C), 4(A), 17(M), 8 (E), 1(L), 2(S) categories that banks and regulatory teams need to consider in evaluating AI use in banks. Although AI offers numerous opportunities to enable banks to operate more efficiently and effectively, at the same time banks also need to give assurance that AI ‘do no harm’ to stakeholders. Posing many unresolved questions, it seems that banks are trapped between the devil and the deep blue sea for now.

Harnessing the Multiple Benefits of a Computerised Maintenance Management System

Those involved in maintenance operations are enjoying the benefits of information and communication technology in the planning and management of maintenance activities, resource management and planned production. In the digital space, the computer-based operating systems, commonly referred to as computerised maintenance management systems (CMMSs), enable quick and effective communication between stakeholders, facilitate improved planning, easy access to historical data, reporting and performance improvements of the maintenance function. However, success in the use of CMMSs depends on the human capacity of the users of the system. In practice, many organisations use the CMMS tool for planning, operations management and reporting, without the aid of detailed analysis of operational information in the CMMS database. They fail to harness all the possible benefits. Three case studies were used to illustrate the situation. Two of them refer to academic institutions and the third is a manufacturing company. In the academic institutions, the CMMS was used for maintenance planning, management and periodic reporting. The manufacturing company included analysis of the information in the operational database, which culminated in identifying the level of the reliability of machines in the production network through benchmarking. The conclusion is that the quality of the human capacity enables organisations to harness and make maximum use of the potentials inherent in typical CMMS software.