As artificial intelligence reshapes financial services — from credit risk assessment and fraud prevention to customer service and trading — the question is no longer whether to adopt it, but how to do so responsibly.
The Financial Stability Board (FSB) has released a consultation report proposing 12 sound practices for financial institutions of all types and sizes to adopt, use, and innovate with AI while managing the associated risks. The practices are organized around two pillars: organization-wide AI governance (covering board oversight, accountability frameworks, risk management, and organizational adaptability) and AI lifecycle management (covering materiality assessment, model selection, data governance, explainability, performance monitoring, human oversight, and third-party and cyber risk). The report also addresses emerging and complex forms of AI — including generative AI (GenAI) and agentic AI — and acknowledges that the risks of not adopting AI, such as reduced capacity to detect financial fraud, are equally relevant considerations. The practices are intended as a menu, not a mandatory standard, with proportionality as a guiding principle.
The FSB is inviting comments from financial institutions, supervisors, and other stakeholders by 22 July 2026.
