LO 9.1.7.B

Learning Objective: Describe the implications of uses of artificial intelligence and machine learning by financial institutions for market concentration and the systemic importance of those institutions.

Review

• Market concentration

The emerging presence of a small number of advanced third-party suppliers in AI and ML applications could create a concentration of service providers in certain financial services.

• Systemic importance

A systematic importance (advantage) can be acquired by “large” financial institutions that have the necessary resources to exploit opportunities in the field of big data.