The FSB is a global watchdog that seeks to identify and manage risks in financial systems.

In a letter to G20 finance ministers and central bank governors ahead of meetings this week, Bailey, who also serves as Bank of England governor, said many countries lacked systems to manage the deployment of advanced artificial intelligence models.

Bailey also warned that the financial sector's dependence on a handful of powerful technology providers could undermine system-wide market confidence.

Regulators are concerned that advanced AI could accelerate the discovery of cyber vulnerabilities, requiring faster patching and creating operational and resilience challenges if testing and recovery processes cannot adapt safely.

His comments follow the US administration's tightly controlled rollout of Anthropic’s powerful Mythos model, which was at one point restricted to US nationals.

“Recent developments highlight the importance of ensuring that advances in capability are matched by resilience and preparedness,” he said.

Supporting safe and responsible model release “on a global basis” should be a priority, he said.

Separately, in July, an OpenAI agent escaped a controlled testing environment and hacked AI company Hugging Face, raising concerns about the potential for AI systems to circumvent safeguards.

Bailey also reiterated previous warnings about the risk of potential market corrections, citing stretched AI valuations and weaknesses in government debt markets.

He also flagged the increased use of leverage in equity markets as an emerging concern.

The US Treasury earlier this month intervened to cap yields on long-term bonds that had reached multi-decade highs.