UK AI Consortium Tackles Model Risk, Contagion, and Concentration in Financial Services

On June 3, 2026, the Artificial Intelligence Consortium (AIC), led by David Geale from the FCA and Sarah Breeden of the Bank of England, convened at the FCA's headquarters. The agenda included updates from four workshops focused on AI-related risks within the financial sector. Workshop 1 explored the explainability of generative AI, advocating for an outcomes-based definition and identifying mitigating factors in line with SS1/23. Workshop 2 examined contagion risks accelerated by AI and proposed responses at the firm level. Workshop 3 highlighted concentration risks among AI providers and recommended upskilling initiatives. Lastly, Workshop 4 presented a four-step strategy for managing AI failures. The consortium underscored the importance of governance, incident reporting, and model design, with findings to be compiled into a final publication later this year for the AIC's second phase.