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BoE Warns Banks Against AI Cybersecurity Risks

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BoE Warns Banks Against AI Cybersecurity Risks

England’s central bank is warning lenders they shouldn’t assume they are invulnerable to artificial intelligence (AI)-powered cyberattacks.

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Sarah Breeden, deputy governor of the Bank of England (BoE) said Thursday (Oct. 15) that advances in artificial intelligence (AI) meant the technology now presents a “systemic risk” to the world financial system.

“It’s not enough now to assume that the cyber attackers won’t get through,” said Breeden, whose comments at the Institute of International Finance annual meeting in Bangkok were reported by Reuters. “We need to be thinking about what are the bare metal recovery options … that we need for the core services, and we need to think about that end-to-end across the financial system.”

She added that the BoE is surveying banks on their preparedness for risks that quantum computing presents to encryption and will use the findings to craft a system-wide response for the financial sector.

Breeden said the chief concern is either hackers or hostile nations weaponizing advanced AI models to exploit weaknesses in banks’ systems. Regulators are also concerned about rogue AI agents functioning in ways that are not expected and bypassing banks’ safeguards.

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Bare metal systems are entirely independent from a bank’s main tech set-up and can go to work if primary operating systems are compromised, the Reuters report added.


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