Model Risk Management in 2026: A Banker’s Guide to the Revised Interagency Guidance

On April 17, 2026, the Federal Reserve, FDIC, and OCC rescinded prior model risk management guidance and replaced it with a principles-driven framework that explicitly brings GenAI and agentic systems into scope. The revised guidance requires banks to tier models by materiality, apply proportionate controls, maintain end-to-end lifecycle governance, and produce evidence of good governance as a byproduct of normal work. This creates substantial compliance engineering requirements across banking institutions while signaling regulatory acceptance of AI systems in financial decision-making.