Banking regulators in the United States and Europe are increasing their scrutiny of artificial intelligence use across the financial sector as concerns grow over cybersecurity threats and potential risks to global financial stability. The move reflects growing awareness that advanced AI systems are developing rapidly, creating new challenges for banks and the authorities responsible for overseeing them.

In the United States, the Federal Reserve, the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation are seeking more information from banks about their use of advanced AI technologies. Their inquiries include the deployment of autonomous AI agents for cybersecurity, the use of models developed in China and the safeguards institutions have established to control these systems.

Regulators are examining whether AI tools operate within clearly defined limits, whether their decisions can be monitored and audited, and whether human employees retain control over important actions. They are also assessing how banks can prevent automated systems from exceeding their authority and shut them down if problems arise. The authorities are still gathering information and have not yet introduced specific new requirements in response to these inquiries. <Cite refs={["turn317662search0"]}/>

European regulators are focusing on the ability of financial institutions to recover quickly from serious cyber incidents. The Bank of England is encouraging major lenders to consider independent backup systems that can restore operations if their main technology infrastructure is compromised. The European Central Bank has also asked banks to prepare plans addressing cyber threats involving AI, with an end of October deadline for submissions.

The growing attention comes as banks adopt AI for a wider range of activities, including cybersecurity, regulatory compliance and other operational functions. Although these technologies can improve efficiency and help identify threats, increasingly autonomous systems may also introduce vulnerabilities that are difficult to detect or manage.

Another concern is banks’ dependence on external technology providers. If several financial institutions rely on the same technology infrastructure, a major cyber incident could affect multiple organisations simultaneously. Disruptions to essential systems could interfere with customer access, payments and other banking services, potentially spreading the impact across financial markets.

Financial authorities and industry specialists are therefore placing greater emphasis on strong cybersecurity controls, effective human supervision and reliable recovery arrangements. The challenge for regulators is to ensure that banks can benefit from advances in artificial intelligence while protecting customers, maintaining operational continuity and reducing risks to the wider financial system.