financial · Federal Reserve SR 11-7 · OCC 2011-12 · Basel III Pillar 2
Bank Model Risk Management (SR 11-7)
CMRO must document human review before remediation — receipt or 483-equivalent
—Freddie Mac AI governance (SR 11-7 baseline)
Regulatory exposure — commonly overlooked:
Banks validate models quarterly but cannot produce per-inference audit — examiners now ask both. · Multinationals built for one jurisdiction fail exams in another — one receipt architecture, many filing packs.
TAM / Exposure
Every OCC-supervised bank · SR 11-7 is law since 2011
Insurance lines
Bank E&O · D&O · Crime
Exhibit authority
Global External Validation — SR 11-7 Model Validation Evidence Pack
Global leaders
Federal Reserve · OCC · JPMorgan · Goldman Sachs · Moody's · ISO · NIST · OECD
Model drift
Performance degradation without documented override = consent order pattern.
Vendor models
Third-party credit models — bank owns validation, vendor owns nothing.
CECL correlation
AI loss forecasting for CECL requires auditable assumption chain.