Frontier Artificial Intelligence Models and the Evolving Cyber-Threat Landscape

Circular
Triq l-Imdina, Zone 1 Central Business District, Birkirkara CBD 1010 +356 2144 1155 communications@mfsa.mt www.mfsa.mt Frontier Artificial Intelligence Models and the Evolving Cyber￾Threat Landscape This Circular applies to all Licence Holders. References to Regulation (EU) 2022/2554 on digital operational resilience for the financial sector (“DORA”) apply only to those Licence Holders falling within its scope. Background and Recent Developments The Malta Financial Services Authority (the “MFSA” or the “Authority”) draws Licence Holders’ attention to recent European publications concerning the evolving cyber risks associated with Frontier Artificial Intelligence Models (“FAIMs”). These include the Warning and accompanying report issued by the European Systemic Risk Board (“ESRB”), the communication issued by European Central Bank (“ECB”) and the Joint Statement published by the European Supervisory Authorities (“ESAs”). FAIMs are advanced artificial intelligence (“AI”) models with capabilities that may materially affect offensive and defensive cyber operations. The European publications indicate that such models may enable cyber activity to be conducted with greater speed and sophistication, including through the accelerated discovery of vulnerabilities and development of exploits. Although FAIMs may also support defensive capabilities, their development represents a material change in the cyber-threat landscape. The Authority is not, through this Circular, introducing a separate set of supervisory expectations specifically addressing FAIMs. Rather, the developments highlighted by the European authorities reinforce the continued relevance of existing regulatory requirements and of the governance, risk management and prudential principles previously communicated by the MFSA, including through its Dear CEO Letter on Artificial Intelligence issued on 4 June 2026. 5 August 2026