Bank of England Governor Andrew Bailey used his Mansion House speech on Tuesday evening to renew his call for the U.S. to take a more cooperative approach to tackling risks from frontier AI models.
"This needs to be coordinated internationally because no country can seal itself off from the cross-border nature of systems that are prevalent today," he said.
Rees and fellow ministry appointee Rohit Dhawan, Lloyds Banking Group's LLOY.L head of AI, have developed a package of recommendations on AI policy and regulation that aim to boost use of the technology.
The proposals, which also urge regulators to review the growing use of AI chatbots to deliver financial advice to consumers, were published on Tuesday as part of the government's financial services AI adoption plan ahead of finance minister Rachel Reeves' annual Mansion House speech.
The UK government said it would work with regulators and industry on the next steps.
In a statement, Reeves said she has "set out a serious plan for AI sovereignty, backing British companies to compete and win", adding that the AI Adoption Plan is central to achieving this across the financial services sector.
Regulators have long warned that concentration among critical technology providers could pose financial stability and operational risks.
Alongside work to boost domestic capability, the UK should increase its options by building relationships with AI companies outside the U.S., such as those in China and France, Rees said.
To improve transparency and strengthen the resilience of the AI companies on which banks already depend, Dhawan added that the UK could bring them within the remit of financial regulators by designating them as “critical” providers to the finance sector, joining four U.S. cloud providers announced on Friday.
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