AI is a threat to the stability of the global financial system, says BoE chief Andrew Bailey

Bank of England Governor Andrew Bailey has written a letter, published Monday, warning that artificial intelligence is a threat to the stability of the global financial system. The letter says increasingly powerful frontier AI models are raising the threat level for a disruptive cyber attack.

In the letter, Bailey flagged stretched valuations, rising leverage, cyber concentration, and missing release protocols as channels through which AI could contribute to a disorderly correction. The letter gives particular attention to cyber concentration and the absence of release protocols. The published excerpt does not elaborate on what 'missing release protocols' would entail.

Bailey's warning places frontier AI models within the scope of financial stability monitoring. It treats both market conditions and the governance of model releases as relevant to systemic risk. The letter also links the threat of a disruptive cyber attack to the increasing power of frontier models. No new regulatory proposals from the Bank of England are described in the article. The article presents the letter as a warning rather than an announcement.