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HKMA Deputy Chief: AI can execute decisions but humans remain ultimately responsible
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In a speech at the Hong Kong Banker Summit, Hong Kong Monetary Authority (HKMA) Deputy Chief Executive Arthur Yuen addressed the evolving role of artificial intelligence in banking, stating that AI is now capable of not only assisting but also executing decisions and actions. He expressed concern over how banks can effectively govern AI, enhance technical resilience, and ensure the banking system evolves with increasing complexity. Yuen emphasized that while AI can provide decision-making solutions and automate processes, human oversight remains crucial, with humans ultimately responsible for decisions. He also discussed tokenization, noting it creates opportunities for programmable value transfer but must not compromise trust; all blockchain transactions must be accurate and authorized. Yuen stated that frontier AI models have not fundamentally changed cyber risk management, but standards must be adjusted for faster and larger-scale cyberattacks. He revealed that HKMA will issue practical application guidelines to help banks translate data excellence principles into concrete actions. Additionally, HKMA's generative AI sandbox, launched years ago, has tested over 40 use cases, half of which have been productized.
Source report
Hong Kong, [Date] – Eddie Yue, Deputy Chief Executive of the Hong Kong Monetary Authority (HKMA), stated at the Hong Kong Bankers Summit that artificial intelligence (AI) is no longer merely a support tool but is now capable of executing decisions and actions. He highlighted several key concerns for the banking sector, including effective AI governance, enhancing technological resilience to keep pace with an increasingly complex environment, building a trusted tokenization framework, and ensuring data quality.
Yue announced that the HKMA will release practical application guidelines to help banks translate data excellence principles into concrete actions.
AI and Human Oversight
Yue noted that while AI can provide decision-making solutions and execute certain processes, this does not mean every application scenario must be automated or autonomous. He stressed the importance of human oversight, emphasizing that final decisions and accountability must remain with humans.
Tokenization Opportunities and Risks
Tokenization, Yue explained, makes value transfer programmable, transforming how transactions are structured and how financial services are delivered to users, thereby creating significant opportunities for banks. However, he cautioned that trust must not be sacrificed, and all blockchain-based transactions must be verified as authentic, accurate, and authorized.
Cybersecurity and Third-Party Risks
The HKMA maintains that cutting-edge AI models have not fundamentally changed the landscape of cyber risk management. However, standards must be adjusted to address faster and larger-scale cyberattacks. The authority is actively guiding the industry to manage these risks and expects banks to:
- Strengthen cybersecurity controls
- Assess whether third-party service providers have implemented adequate risk management measures
- Evaluate potential backdoor attack risks
Generative AI Sandbox Results
Yue mentioned that the HKMA launched a generative AI sandbox several years ago, which has tested over 40 use cases. Half of these have already been productized.
Source
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