Bank of England Deputy Governor: rapid development of generative AI and its applications could have implications for the financial system

Financial regulators must establish a policy framework to manage the risks posed by artificial intelligence (AI) and safeguard financial stability, said Bank of England Deputy Governor Briden, according to Golden Ten. Briden noted that the rapid development of generative AI and its applications could have an impact on the financial system. To this end, the Bank of England has launched an AI consortium, inviting the private sector and AI experts to participate, with the aim of gaining a deeper understanding of the benefits and potential risks of AI. According to a five-year survey by the BoE and the UK's Financial Conduct Authority (FCA), the use of AI in financial services is growing rapidly, with 75% of the nearly 120 firms surveyed having adopted some form of AI, up from 53% in 2022. The BoE will work with the FCA, government and international partners to drive the safe use of AI. The BoE's Financial Policy Committee (FPC) is focusing on the macro-prudential risks posed by AI, in particular its potential impact on financial stability.The FPC plans to publish a detailed assessment of AI's impact on financial stability early next year to help develop appropriate regulatory policies to ensure the safe use of AI in the financial system.