On 10 June 2026 the FSB published a consultation proposing 12 sound practices for responsible AI adoption by financial institutions, with comments due 22 July 2026. Practices 1–4 cover organisation-wide governance (strategic direction and oversight, governance and accountability, incorporating AI into the risk-management framework, organisational adaptability); practices 5–12 cover the AI lifecycle (materiality and risk assessment, selection, data governance, explainability and transparency, performance management, human oversight, cyber and ICT risk, third-party AI risk). It addresses all forms of AI with specific attention to generative and agentic AI. The final report is expected in October 2026 as a deliverable to the US G20 presidency.
| Document | FSB AI sound practices consultation (June 2026) — Sound Practices for Responsible Adoption of Artificial Intelligence (AI): Consultation report |
| Issued by | Financial Stability Board |
| Type | Consultation |
| Status | Proposed · comment period closed |
| Published | Jun 10, 2026 |
| Comment deadline | Jul 22, 2026 |
| Applies to | All types of financial institutions, banks and non-banks, proportionate to size and complexity; addressed to FSB member authorities for implementation |
| Official source | fsb.org ↗ |
| Use cases | AI governance (general) · Model risk management · Generative & agentic AI · Third-party & vendor AI · Cybersecurity · Data & privacy |
What are the key points of FSB AI sound practices consultation (June 2026)?
- Sound Practice 1 Strategic direction and oversight: board and senior management align AI with business model, risk appetite and strategy.
- SP2 Governance and accountability; SP3 Incorporation of AI risks into the risk-management framework; SP4 Organisational adaptability (skills, resourcing).
- SP5 Materiality and risk assessment; SP6 Selection of AI models/systems (traditional, GenAI or agentic) fit for the use case; SP7 Data governance.
- SP8 Explainability and transparency; SP9 Performance management including testing and ongoing monitoring; SP10 Human oversight, with extra measures for highly autonomous agentic AI.
- SP11 Cyber and ICT risk management for AI; SP12 Third-party AI risk management, building on the FSB's 2023 third-party toolkit.
- Agentic AI risks named include autonomous multi-step actions, agentic memory poisoning, and AI-generated code defects; case studies include agentic fraud detection at a large bank.
- Proportionality: lower-risk AI uses should get a lighter supervisory and regulatory touch (Fed Vice Chair Bowman, 7 July 2026 FSB outreach).
- 159 public responses published 6 August 2026; FSB expects to publish the final report 'in the coming months'.
What did FSB AI sound practices consultation (June 2026) change for banks?
It is the FSB's first firm-level AI expectations rather than authority-level monitoring. For US banks it overlaps with SR 11-7/OCC model-risk guidance and 2023 third-party guidance but adds explicit expectations on AI inventories, explainability, human oversight and agentic AI that examiners are likely to import.
What are the FSB's 12 sound practices for AI?
Strategic direction and oversight; governance and accountability; incorporation of AI risks into the risk-management framework; organisational adaptability; materiality and risk assessment; selection; data governance; explainability and transparency; performance management; human oversight; cyber and ICT risk management; third-party AI risk management.
When is the FSB's final AI sound practices report due?
October 2026, as a deliverable to the US G20 presidency; as of 26 August 2026 only the consultation responses (6 August) have been published.
Do the FSB sound practices apply to small banks?
They are meant for all financial institutions but applied proportionately; the FSB and Fed Vice Chair Bowman stressed lower-risk AI uses should receive a lighter touch.
| Date | Document | Status |
|---|---|---|
| Aug 6, 2026 | Responses to FSB AI sound practices consultation (Aug 2026) — Public responses to consultation on Sound Practices for Responsible Adoption of Artificial Intelligence (AI) | Final |
| Jul 7, 2026 | Bowman remarks at FSB AI outreach (July 2026) — Opening remarks on sound practices for artificial intelligence (FSB virtual outreach event) | Final |
| Oct 10, 2025 | FSB AI monitoring report (Oct 2025) — Monitoring Adoption of Artificial Intelligence and Related Vulnerabilities in the Financial Sector | Final |
| Oct 10, 2025 | FSB next steps on AI monitoring (Oct 2025) — FSB outlines next steps for authorities on AI monitoring | Final |
| Nov 14, 2024 | FSB AI financial stability report (Nov 2024) — The Financial Stability Implications of Artificial Intelligence | Final |
| Dec 4, 2023 | FSB third-party risk toolkit (2023) — Final Report on Enhancing Third-party Risk Management and Oversight: A toolkit for financial institutions and financial authorities | Final |
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