Emerging Risk Trends
Key Takeaways
Commentary: Diverging global regulations are driving operational complexity—firms must align compliance strategies across jurisdictions.
Commentary: Insurers are focusing on systemic risk events, supply chain resilience, and how well firms have segmented critical infrastructure.
Commentary: ESG is now a battleground—GB regulation is tightening while US scrutiny intensifies under a politically fractured landscape.
Regulatory and Political Risk
In the US, a Trump-led administration may ease industry-wide regulatory scrutiny—but uncertainty remains around enforcement priorities, particularly from the SEC and CFPB.
In GB, the Financial Services Growth and Competitiveness Strategy (2025) promotes growth while preserving core consumer protections.
The FCA remains firm on client duty, product suitability, and oversight of retail-facing propositions.
AI regulation varies significantly across markets, increasing compliance friction for global banks.
Cybersecurity and Technology Risks
Banks are under increasing scrutiny over cloud migration, digital banking expansion, and technology partnerships (especially with FinTech firms).
GenAI and quantum computing are fast-emerging concerns, particularly in fraud, bias, and misinformation risk.
Regulatory frameworks (e.g. GB Operational Resilience rules and EU’s DORA) require more robust resilience testing and supply chain governance.
ESG and Climate Risk
ESG and DEI-related litigation is rising in the US as state AGs challenge investment frameworks and public statements.
In GB, insurers expect ESG risks to be actively managed and evidenced through data, governance, and board oversight.
TNFD requirements will trigger mandatory sustainability disclosures starting in 2026, impacting large institutions from 2025.
