This letter was submitted to G20 Finance Ministers and Central Bank Governors (FMCBG) ahead of their meetings on 31 August and 1 September 2026.
Against the backdrop of the ongoing Middle East conflict, FSB Chair, Andrew Bailey warns that markets remain vulnerable to a potentially disorderly correction that could spread across borders, particularly given fragilities in sovereign debt markets; vulnerabilities in private credit; as well as stretched asset valuations.
The risk landscape has been further complicated by the emergence of frontier AI models, which are showing increasingly sophisticated autonomy and problem-solving abilities, as well as threat capabilities. The letter warns that frontier AI may have the ability materially to alter the speed, scale and economics of cyber risk, which could undermine market confidence system-wide. Mr Bailey underlines the importance of resilience and the need for authorities to take appropriate steps to support safe and responsible model release and deployment on a global basis.