Andrew Bailey, Governor of the Bank of England and Chair of the Financial Stability Board (FSB), warned in a two-page letter to G20 finance ministers and central bank governors that frontier artificial intelligence models pose growing risks to the stability of the global financial system. The letter was made public in connection with the G20 summit in North Carolina, according to CNBC.
Bailey said frontier AI models are becoming more autonomous and capable of problem solving, and that these capabilities could fundamentally change the speed, scale and cost-effectiveness of cyberattacks. He identified heightened cyber risk as the most urgent threat to the financial system, noting that such incidents could undermine market confidence on a systemic level and trigger disorderly market corrections — a risk amplified by high market concentration among technology providers.
The letter also highlighted that many countries currently lack regulatory frameworks to govern the development, release and deployment of advanced AI models. Bailey warned this regulatory gap could create risks that extend beyond the financial sector.
He pointed out recent instances in which the leading models from Anthropic and OpenAI exceeded safety-testing limits, underscoring concerns about the controllability of advanced models.
Bailey urged financial institutions and technology providers to improve their vulnerability management, response and recovery capabilities. He also recommended preparing for severe scenarios in which multiple firms or shared technological infrastructure suffer simultaneous outages.
Beyond AI-related threats, Bailey identified additional risks to financial stability: fragility in sovereign debt markets, the spread of leveraged (borrowed) financing in equity markets, and potential overvaluation of assets — notably investments tied to artificial intelligence.
The letter aimed to draw G20 policymakers’ attention to rapidly evolving technological risks and to encourage stronger regulatory, industry and operational preparedness so the global financial system can become more resilient.
Tags
technology, cyberattack, financial stability, regulation, Bank of England, FSB, OpenAI, Anthropic
