In opening remarks at the 2026 Community Bank Cyber Workshop, Federal Reserve Board Vice Chair for Supervision Michelle W. Bowman called on community banks to strengthen cyber hygiene and resilience as artificial intelligence increases the speed, sophistication and accessibility of cyberattacks. She highlighted ransomware, business email compromise and vendor data breaches as continuing risks, while warning that AI can accelerate vulnerability discovery, enable sophisticated social engineering and allow attacks to adapt in real time. Bowman emphasized up-to-date asset inventories, phishing-resistant multifactor authentication, strong identity and access controls, vulnerability identification and patch management, employee training, and periodic testing of incident response programs. Boards and senior management should oversee cyber risk proactively and align investments in people, processes and technology with each institution’s risk and complexity. She also noted that the Federal Reserve tailors information technology examinations to banks’ risk profiles and emerging threats. AI can support cyber defenses but requires sound risk management when deployed. Bowman referred to the Financial Stability Board’s June 2026 report on responsible AI adoption, including practices and case studies relevant to smaller financial institutions, and invited community banks to provide feedback on how supervisory expectations could be made clearer for them.
US Federal Reserve Board Vice Chair Bowman urges community banks to strengthen cyber defenses as AI expands threats
Federal Reserve Board Vice Chair for Supervision Michelle W. Bowman urged community banks to reinforce cyber hygiene as AI makes attacks faster and more sophisticated. She emphasized core controls, employee training, incident response testing and active oversight by boards and senior management. AI can also strengthen defenses, but banks should deploy it with sound risk management.