Bailey Warns G20 on AI-Driven Cyber Threats

Bank of England Governor Andrew Bailey has issued a warning to G20 finance ministers about the growing risks posed by frontier artificial intelligence models. In a letter delivered ahead of the G20 meeting in North Carolina, Bailey noted that these advanced AI systems demonstrate increasingly sophisticated autonomy and problem-solving abilities, as well as threat capabilities.

Bailey cautioned that many jurisdictions lack protocols to manage such technologies, which could undermine market confidence system-wide due to highly concentrated third-party service providers. He also highlighted the fragilities in bond and equity markets, where increased leverage and elevated valuations leave the system exposed to sudden shocks.

As chairman of the Financial Stability Board, Bailey urged appropriate steps to support safe and responsible model release and deployment on a global basis. He emphasized that frontier AI may have the ability to materially alter the speed, scale, and economics of cyber-risk, which could trigger multiple vulnerabilities concurrently.