Institutional Reconstructibility in AI-Driven Banking

Abstract Contemporary discussions on cyber resilience, operational resilience and third-party dependencies recognise the challenges posed by ecosystem complexity, concentration, outsourcing arrangements and technological opacity. This contribution argues that these developments reveal a broader governance challenge. As financial market infrastructures become dependent upon complex technological ecosystems, the central question is no longer limited to operational continuity. Institutions must also preserve the capacity to generate, validate, supervise and defend the evidence upon which decisions, accountability and oversight ultimately depend. To address this challenge, the paper introduces the concept of Evidence Infrastructure: the set of organisational, technological and governance arrangements through which evidence is produced, preserved, validated and made available for scrutiny. From this perspective, operational disruptions and validation failures may represent different manifestations of a common problem: deterioration of the infrastructures that sustain institutional governability. Building upon this premise, the paper explores institutional opacity, Tolerance for Opacity (TfO), Systemic Opacity Risk (SOR), Institutional Reconstructibility, Validation Governance and Evidentiary Resilience, together with the supervisory challenges arising from opaque dependency structures. Rather than proposing an alternative to existing resilience frameworks, the paper seeks to complement ongoing CPMI-IOSCO, Basel and DORA-related discussions by examining how institutions may preserve governability when critical infrastructures remain operational but become progressively more difficult to validate, supervise or reconstruct. [A Contribution to CPMI-IOSCO’s Consultations on Cyber Resilience]