What's new
Overview
This deep dive examines the latest developments in artificial intelligence, including emerging adoption patterns, key risk watch points, evolving policy and supervisory guidance, and research on the economic impact of AI.
What's new
Canadian Securities Administrators publish 2025 Systemic Risk Committee report highlighting AI and stablecoin concentration risks
The Canadian Securities Administrators published its 2025 Systemic Risk Committee Annual Report, highlighting the resilience of the Canadian financial system amid economic uncertainty and trade conflicts. Key issues include the impact of artificial intelligence on financial stability, stablecoin concentration risks, and the importance of global regulatory coordination, with no current systemic risk from stablecoins identified.
Commodity Futures Trading Commission appoints members of its Innovation Advisory Committee
The Commodity Futures Trading Commission announced the membership of its Innovation Advisory Committee, which will advise on innovation in derivatives and commodity markets, focusing on technologies like artificial intelligence and blockchain. Chairman Michael S. Selig sponsors the committee, with Michael Passalacqua as the designated federal officer.
Bank of Japan publishes IMES Newsletter on finance workshop on machine learning and AI for financial analysis
The Bank of Japan's Institute for Monetary and Economic Studies released a newsletter summarizing the 2025 BOJ-IMES Finance Workshop, which focused on machine learning and artificial intelligence applications in financial analysis.
International Organization of Securities Commissions publishes 2026 work program prioritising market resilience, investor protection and technological transformation
The International Organization of Securities Commissions (IOSCO) released its 2026 Work Program, highlighting five priorities: financial resilience, investor protection, market evolution, technological transformation, and regulatory cooperation. Key initiatives include reviewing IOSCO principles, over-the-counter derivatives, and operational resilience. IOSCO will focus on investor protection via a TechSprint with the UK Financial Conduct Authority and develop crypto and digital assets assessment methodologies.
Bermuda Monetary Authority signals no immediate AI-specific requirements as it reviews feedback on responsible AI discussion paper
The Bermuda Monetary Authority has issued a stakeholder letter on feedback to its July 2025 discussion paper on responsible AI use in Bermuda’s financial services sector, explaining how this informs ongoing policy work and confirming no new AI-specific rules are planned. Its approach will remain outcomes-focused, principles-led and technology-neutral within the existing framework, embedding AI into current governance, risk, conduct, resilience and third-party oversight, with boards accountable for AI outcomes. The Authority will monitor AI under existing rules, address cross-border and third-party concentration risks, and consider incremental enhancements through its standard consultation process.
U.S. Securities and Exchange Commission outlines AI oversight and disclosure expectations as tokenization reaches the municipal securities market
The U.S. Securities and Exchange Commission noted that emerging technologies like tokenization and artificial intelligence are transforming the municipal securities market while maintaining existing legal obligations. The speech stressed the need for municipal advisors and underwriters to understand blockchain and digital assets, manage compliance risks, and ensure transparency and accuracy in disclosures under Municipal Securities Rulemaking Board Rule G-17 and Rule 15c2-12.
International Actuarial Association consults on draft papers for actuarial use of AI and launches volunteer call for catastrophe modelling task force
The International Actuarial Association is consulting on three draft educational papers from its 2024 Artificial Intelligence Task Force, with comments due by 28 February 2026, and seeks nominations for a task force to develop vendor-neutral training on catastrophe modelling outputs. Program details for the IAA Council and Committee Meetings in Ljubljana have been released, with registration closing on 24 April 2026.
European Central Bank Banking Supervision sets out 2026 supervisory priorities for AI governance, tokenisation and operational resilience
In a keynote speech, Patrick Montagner of European Central Bank Banking Supervision emphasized aligning digital transformation with governance and risk controls, particularly in AI and tokenisation. He highlighted AI-specific risk management shortcomings and concentration risks from non-EU providers, stressing the importance of the Digital Operational Resilience Act for unified incident reporting. The ECB plans to focus on generative AI, third-party dependencies, and operational resilience in 2026.
U.S. Securities and Exchange Commission investment management director urges industry engagement on AI use and LLM-based fund disclosures
Brian Daly, Director of the U.S. Securities and Exchange Commission’s Division of Investment Management, discussed AI in investment management at the Investment Company Institute Winter Board Meeting, highlighting uneven adoption due to liability concerns and oversight challenges. He noted the SEC's outdated technology framework and invited industry engagement on AI-related regulatory issues, including pilot programs and guidance requests.
International Monetary Fund projects AI could lift global productivity by up to 0.8 percentage points a year and urges coordinated guardrails and reskilling
IMF Managing Director Kristalina Georgieva highlighted artificial intelligence as a key growth driver at WGS in Dubai, while cautioning about potential labour market disruptions and divergences between countries. She emphasized policy priorities including macroeconomic support for AI investment, regulatory "guardrails," and international cooperation for data sharing and innovation.
Hong Kong Monetary Authority publishes Fintech Promotion Blueprint under Fintech 2030 with four flagship projects on AI DLT and quantum readiness
The Hong Kong Monetary Authority has released a Fintech Promotion Blueprint to advance AI and distributed ledger technologies, emphasizing data excellence and cyber resilience. The plan includes four flagship projects: a Quantum Preparedness Index, a New Risk Data Strategy, a Fintech Cybersecurity Baseline, and competency development for AI and DLT-enabled financial services.
European Insurance and Occupational Pensions Authority survey finds 65% of EU insurers already using generative AI and flags hallucination and third-party risks
The European Insurance and Occupational Pensions Authority (EIOPA) released a survey on generative artificial intelligence (Gen AI) in the European insurance sector, highlighting rapid adoption for internal efficiency, with most applications at early stages and strong human oversight. Key challenges include data privacy, regulatory compliance, and skills shortages, while EIOPA plans to monitor Gen AI risks, assess the Artificial Intelligence Act's impact, and support related regulatory initiatives.
French Financial Markets Authority publishes study on how financial market participants use artificial intelligence
The French Financial Markets Authority released a study on artificial intelligence usage among French financial market participants, highlighting use cases, benefits, risks, and future expectations based on 100 responses from supervised entities, listed companies, law firms, and audit firms.
Guernsey Financial Services Commission publishes policy statement encouraging firms’ AI adoption without introducing AI-specific rules
The Guernsey Financial Services Commission has issued a policy statement supporting the use of artificial intelligence (AI) within its principles-based regulatory regime, allowing firms to implement AI without specific approval. Firms must adhere to existing governance and financial crime rules, and the Commission encourages discussions on potential rule adaptations for technology trials.
Germany's Federal Financial Supervisory Authority warns of higher financial stability stress risk and adds consumer top risks to 2026 outlook
Germany's Federal Financial Supervisory Authority's Risks in Focus 2026 report warns that stretched valuations and geopolitical, debt and AI-related uncertainties have raised the risk of abrupt market corrections and a broader test of financial stability. Its main concerns are rising credit risk and non-performing loans, contagion through private-debt funds, and consumer risks including over-indebtedness from buy now pay later products and speculative retail crypto activity. The report adds consumer top risks for the first time and points to tighter monitoring of consumer credit and crypto providers in 2026.
Germany’s Federal Financial Supervisory Authority warns of abrupt market corrections and sets 2026 supervisory priorities on credit, private debt and retail risks
Germany’s Federal Financial Supervisory Authority (BaFin) released its 2026 “Risks in Focus” report, highlighting fragile financial markets and potential for sudden corrections. Key priorities include intensified monitoring of credit risk and links between regulated firms and non-bank intermediaries. BaFin also plans stricter oversight of consumer credit and crypto providers, addressing rising over-indebtedness and social media-driven retail investment.
European Central Bank sets 2026-28 banking supervision priorities and advances plans to streamline SREP and supervisory processes
ECB Executive Board member Frank Elderson outlined 2026-28 priorities: strengthening resilience amid evolving risks, enhancing operational resilience in a digitalized financial system, assessing geopolitical scenarios, evaluating climate and nature-related risks, focusing on cybersecurity, encouraging responsible innovation, and reforming supervisory activities with digital tools.
International Swaps and Derivatives Association chair Amy Hong sets 2026 priorities focused on tokenization and AI-led derivatives market modernization
The International Swaps and Derivatives Association outlined its 2026 priorities, focusing on modernizing derivatives markets with technologies like tokenization and artificial intelligence.
Central Bank of Egypt signs MoU with New Giza University to launch an AI Diploma for bankers through FinTech Egypt’s Digital Academy
The Central Bank of Egypt and New Giza University have launched the first specialized Artificial Intelligence Diploma for Bankers under the "Digital Academy" initiative by FinTech Egypt. This program aims to enhance banking professionals' skills in AI and FinTech, supporting Egypt's digital transformation goals. The diploma includes five training modules on AI fundamentals, techniques, data management, governance, and implementation in banking.
UK Financial Conduct Authority launches Mills Review on how advanced AI could reshape retail financial services
The Financial Conduct Authority (FCA) has initiated the Mills Review and released an engagement paper to gather insights on the impact of advanced artificial intelligence on consumers, retail financial markets, and regulation, with a focus on developments through 2030 and beyond. Feedback is due by 24 February 2026, and while the FCA does not intend to introduce AI-specific regulation, it will continue to apply its principles-based framework.
European Parliament Legal Affairs Committee adopts report calling for opt-out, transparency and remuneration for copyrighted works used to train generative AI
The European Parliament’s Legal Affairs Committee adopted a report proposing transparency and fair remuneration for rightsholders when generative AI uses copyrighted works, including transparency requirements for AI providers and the ability for rightsholders to refuse content use. The report, to be voted on in March, rejects a global licence model and calls for the European Commission to explore voluntary collective licensing agreements and tools to prevent unauthorized AI use.
National Bank of Georgia launches free AI career builder programme for fintech professionals with Ant Group
The National Bank of Georgia, in collaboration with Ant Group, launched the "AI Career Builder for Fintech Professionals" program through the 10x1000 Tech for Inclusion platform, offering free professional development focused on AI's role in fintech innovation. The program employs a blended learning model with self-paced modules and live expert sessions.
Bank for International Settlements working paper finds AI adoption lifts European firms’ labour productivity by 4% without short-run job losses
The Bank for International Settlements published a working paper indicating that AI adoption in European non-financial firms boosts labor productivity by about 4% without reducing firm-level employment short term, with benefits concentrated in medium and large firms. The study, using data from over 12,000 EU firms and 800 US firms, attributes productivity gains to capital deepening and notes higher wages at AI-adopting firms, with stronger effects where complementary investments are made.
U.S. Senate Committee on Banking, Housing and Urban Affairs Democrats urge FSOC to investigate projected USD 1 trillion AI infrastructure debt for financial stability risks
Democratic U.S. Senate Banking Committee members, led by Elizabeth Warren, urged the Financial Stability Oversight Council (FSOC) to investigate financial stability risks from debt financing for AI infrastructure. They highlighted concerns over complex debt structures and potential market stress, requesting FSOC to collaborate with the Treasury's Office of Financial Research and respond by February 13, 2026.
U.S. House Financial Services Committee marks up package including TRIA reauthorization, AI resolution, digital asset cybercrime AML tools and Securities Act changes
The U.S. House Financial Services Committee, led by French Hill, is marking up bills to reinforce the financial system and national security, including reauthorizing the Terrorism Insurance Program, supporting AI in financial services, and combating money laundering in cybercrime. Other proposals include updating financial reporting thresholds, facilitating micro-offerings for small issuers, and preempting state laws for secondary trading.