Bank of England Seeks Right to Intervene in AI Amid Growing Financial Stability Threat

The Bank of England's governor, Andrew Bailey, has warned about the growing threat posed by artificial intelligence (AI) to financial stability. In a recent opinion piece, Bailey called for the 'right to intervene' in the AI industry, citing the need to establish boundaries within which these systems operate.

Bailey noted that the rapid advancement of frontier AI models has increased the scale and sophistication of cyber threats to the financial system, putting daily card payments, bank transactions, and stock and bond trading at risk. He emphasized that authorities need to be ready to step in and ensure the benefits of AI are realized safely.

The Bank's Financial Policy Committee (FPC) also highlighted the growing mountain of AI debt, which has reached $450 billion (£339 billion) between January and September this year, already surpassing the UK government's gilt issuance for 2026. This has tied investors to the fortunes of AI companies at a time when they have yet to turn a profit.