OversAIght – doesn’t change much
The Dutch Central Bank released a discussion paper on general principles on AI in Finance which you can read here. On the surface, it seems rather well thought out. But as it is a discussion paper, there’s ample room for discussion…
Starting with the decades-old big error of apparently haphazard classification of risks. When the classification isn’t mutually exclusive and collectively exhaustive, one loses the ground for hope of any suitable quality of subsequent classification(s). For example, this happened with the operational risk classification in the Basel-II framework, left dangling in versions ‑III and ‑IV for apparent reasons. And now again, we see in the principles, quite some overlaps and double counting.