Liberty Bank Launches AI Center of Excellence with Flare AI

Liberty Bank has established an AI Center of Excellence through a strategic partnership with Flare AI to deploy secure, compliant artificial intelligence across its personal, commercial, and digital banking operations. According to the bank, the hub focuses on automating core processes and improving customer experience while maintaining the strict governance required for regulated financial institutions.

The Middletown, Connecticut-based mutual bank manages over $9 billion in assets and employs more than 900 people across 51 offices in Connecticut and Massachusetts. The bank’s leadership stated that the new center will serve as the primary hub for AI strategy, governance, and execution.

How does Liberty Bank’s AI strategy differ from traditional software adoption?

Liberty Bank is utilizing an outcome-based partnership rather than purchasing standard software licenses. David Hadd, Liberty Bank’s head of Business Transformation, stated that Flare AI designs and builds systems on the bank’s behalf to compress multi-year technology buildouts into a matter of weeks.

This approach contrasts with the traditional vendor model. Scott Killoh, CEO of Flare AI, noted that most banks are typically sold AI platforms and then left to manage the implementation themselves. Flare AI instead delivers working systems tailored to the specific business needs of the institution.

Why is governance critical for community banks scaling AI?

For regulated institutions, the transition from a pilot program to full-scale production is often where failures occur. Large banks have previously warned that scaling AI in production is more expensive and error-prone than initial pilots suggest, making quality control essential from the start.

David Glidden, President and CEO of Liberty Bank, said the bank’s primary challenge hasn’t been ambition, but the time required to translate strategy into execution. The AI Center of Excellence aims to solve this by building in audit trails and compliance guardrails from the first day of deployment.

What role does institutional familiarity play in AI deployment?

The partnership between Liberty Bank and Flare AI includes a unique layer of institutional knowledge. David Mitchell, the new President and Chief Strategy Officer at Flare AI, previously spent six years as an executive at Liberty Bank.

This overlap allows the AI systems to be built with an existing understanding of the bank’s internal culture and operational bottlenecks, reducing the friction typically found when external consultants attempt to map complex banking workflows.

What are the future trends for AI in regulated finance?

The industry is shifting away from experimental chatbots toward “agentic AI”—systems capable of executing structured tasks rather than just answering questions. For community banks, this means moving toward the automation of complex core processes that previously required manual oversight.

According to industry trends, the gap between large banks with massive tech budgets and community banks is closing through the use of specialized AI partners. The ability to deploy secure, governed AI quickly is becoming a primary competitive advantage for smaller institutions competing for the same customer base as national banks.

Frequently Asked Questions

What is an AI Center of Excellence?
It is a centralized hub within an organization that defines the AI strategy, manages governance, and oversees the execution of AI projects across different business units.

How does Liberty Bank ensure AI security?
The bank integrates security, compliance, and governance controls directly into the AI systems, ensuring they meet the regulatory requirements of the banking industry.

Who is Flare AI?
Flare AI is a strategic partner that specializes in building secure, compliant AI systems for regulated institutions, focusing on outcomes rather than selling software licenses.