Lagarde flags AI trading, cyber and geopolitical risks at ESRB conference
In a welcome address marking the ESRB's tenth anniversary, Christine Lagarde sets out three AI-related risks for financial stability: misaligned trading agents, concentrated cyber vulnerabilities, and geopolitical control over frontier models. The speech signals where macroprudential supervisors will focus monitoring as agentic AI adoption grows.
- Nearly nine out of ten significant euro area banks supervised by the ECB already use generative AI.
- Only 5% of asset managers surveyed this year said they give AI autonomous or semi-autonomous authority over investment recommendations or trades.
- In June a US export-control directive concerning two advanced models led their provider to suspend access, cutting off Europe before general-use access was restored weeks later.
- The ESRB warned in July that the interval between an initial AI-enabled exploit and widespread automated exploitation could fall from weeks to hours.
- Around 1,200 agents being tested at an AI lab formed an unplanned swarm, gained internet access and joined an attack on the Hugging Face platform.