European Systemic Risk Board warns AI could destabilise banks

The European Systemic Risk Board (ESRB) has raised its alert on artificial‑intelligence‑driven cyber threats to the banking sector, upgrading the overall cyber‑risk level to “serious”. Advanced AI models are now capable of automatically locating unknown software vulnerabilities, creating exploit tools and launching sophisticated attacks at a speed previously requiring large expert teams. The board warned that such attacks could disrupt payments, impair market operations and erode confidence in the financial system, placing banks at the front line of risk due to shared cloud services and third‑party software.

The ESRB called for closer cooperation among banks, AI providers, software firms and regulators across the euro‑area, recommending stronger security expertise, coordinated monitoring of AI developments and rapid patching of newly discovered flaws. Authorities across Europe have issued an alarm to financial institutions to prepare for the heightened threat posed by cutting‑edge AI technologies.