Christine Lagarde, President of the ECB and Chair of the European Systemic Risk Board, warned that Europe’s reliance on artificial intelligence models developed in the United States and China could expose critical services and compound risks across the financial system. Nearly nine out of 10 significant euro-area banks use generative AI, while seven out of 10 surveyed EU securities-market firms expect to increase AI investment. Europe holds about 5% of global AI computing capacity, compared with approximately 75% for the US, and produced two notable AI models in 2025, versus 59 in the US and 35 in China. Lagarde called for stronger European AI capabilities, more data-center and compute infrastructure, and a meaningful role in the AI supply chain. She also highlighted risks from increasingly autonomous AI agents, cyberattacks, market concentration and geopolitical restrictions on access to frontier models. A June 2026 US export-control action temporarily suspended European access to two advanced models, demonstrating how policy decisions outside Europe could affect systems used in banking, payments, healthcare, transport, border screening and tax administration. Europe’s data-center capacity deficit is set to grow more than sixfold over the next decade, with closing the gap potentially costing up to €600 billion, while rapid AI adoption could raise productivity by up to 4% over a decade.