The International Monetary Fund warns that advanced artificial intelligence increases the risk of more global bank failures. Frontier AI models dramatically reduce the cost and time needed to identify and exploit vulnerabilities in financial systems, pushing cyber risks to systemic levels. The IMF also fears correlation risk: institutions sharing the same structural weaknesses in their digital infrastructure could be compromised simultaneously. Managing Director Kristalina Georgieva warned that frontier AI, if misused, could destroy the financial system. The fund is urging central banks to strengthen oversight, adopt resilience planning, and coordinate cross-border efforts.
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