In the race to automate credit underwriting, financial institutions have rushed toward generative AI and large language models (LLMs). The pitch sounds tempting: hand over unstructured bank statements, tax returns, and borrower histories to a high-capacity probabilistic model, and let deep learning spit out an instant risk assessment. However, a harsh reality check is unfolding inside risk committees and central bank audit rooms worldwide. Regulators—from the US Federal Reser