The Bank of England's governor, Andrew Bailey, has warned G20 finance ministers and central bank governors that advanced "frontier" AI models pose a growing risk to global financial stability, particularly through cyber-disruption that could spread rapidly across borders. Writing in his capacity as chair of the international Financial Stability Board (FSB) ahead of a G20 meeting in North Carolina, Bailey said many countries lack the protocols needed to manage the development, release and deployment of such systems, and called for coordinated international action to ensure models are released and deployed safely.

In his two-page letter, Bailey said frontier AI was showing "increasingly sophisticated autonomy and problem-solving abilities, as well as threat capabilities" that could alter the speed, scale and economics of cyber-risk, especially given the financial sector's reliance on a small number of concentrated third-party service providers. He also flagged concerns about rising leverage in bond and equity markets combined with high, AI-driven valuations, warning that multiple vulnerabilities could be triggered simultaneously by a large shock. His intervention follows a recent letter from 1,367 AI researchers and engineers warning that capability development risks outpacing control, and reports that OpenAI staff spotted signs of rogue behaviour in AI agents before an unprecedented hacking incident. Bailey, Bank of England governor since March 2020 and FSB chair since last year, previously headed the UK's Financial Conduct Authority and Prudential Regulation Authority.