Apollo Economist Warns AI Agents Could Trigger Bank Runs

Torsten Slok, chief economist at Apollo Global Management, warned that agentic AI assistants such as Meta's Muse and Instinct could trigger a systemic bank run. Slok argues that these AI agents could automatically shift household cash from low-interest checking accounts, which average 0.1% interest, into accounts offering returns between 3.3% and 5.0%.

This mass migration of cheap deposits would deprive banks of the low-cost funding they rely on to issue loans, potentially threatening the stability of the financial system. Data from the Federal Deposit Insurance Corporation suggests that increasing interest on 10 trillion dollars of deposits could wipe out current collective bank profits.

Slok notes that banks might absorb the shock by raising loan rates or merging to reduce costs, citing historical precedents from the post-pandemic interest rate climb.