Navigating the year ahead Financial services regulatory outlooks 2017
The Deloitte Center for Regulatory Strategy has released a series of financial services regulatory outlooks to help financial services firms across the globe navigate the year ahead.
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Globally, 2016 has been another difficult year for the financial sector, with economic and political uncertainty complicating the completion of the post-crisis regulatory repair agenda.
A prolonged period of tepid economic growth and persistently low and volatile interest rates has squeezed profitability in some sectors and put significant pressure on longstanding business models and balance sheet management. Firms are further challenged by continuing uncertainty over the final shape of post-crisis financial regulation. At the same time, new technologies and digital distribution platforms in the financial sector are unleashing disruptive forces, promising benefits to consumers and markets and posing further challenges to the strategies (and margins) of established firms.
Despite the uncertainty that will characterize 2017, one fact is becoming increasingly clear: financial services firms will not be able to wait out this current period of difficulty without taking decisive and, in some cases, bold actions in response.
With this backdrop in mind, the Deloitte Center for Regulatory Strategy outlooks are designed to provide a clear view of the regulatory landscape and of the actions firms should be taking to respond to regulation. The regulatory outlooks available are:
Asia Pacific regulatory outlook
For financial institutions in Asia Pacific, the focus this year will turn from developing and finalizing prescriptive regulation, to intensified supervision, an increased focus on governance, and continuous planning and testing; as well as dealing with emerging risks such as disruptive innovation and cybersecurity. Firms need to refresh their strategies to best respond to this changing environment.
Canadian regulatory outlook
For financial institutions in Canada, understanding the impact recent global political shifts will have on financial markets, and Canadian regulatory policies, is key in 2017. While it may be tempting to wait for the dust to settle, Canadian FIs must be proactive—testing and monitoring their programs to understand potential risk gaps, to ensure no matter what happens on the regulatory front, they aren’t left scrambling to solve unanticipated problems.
EMEA regulatory outlook
For financial institutions in EMEA, 2017 will bring significant challenges such as heightened macro-policy uncertainty, the implementation of a demanding and still evolving regulatory agenda and other market developments putting pressure on the industry. Business models across all sectors will need to adapt to this tougher environment.
United States regulatory outlook
For financial institutions in the United States, the year ahead will be one that may, given the 2016 election results, reshape the regulatory landscape for the industry. As companies look for clues and direction to help guide their compliance strategies, actions, and investments in 2017 and beyond, they need to be proactive and pay extra attention to regulatory changes as they unfold.