Insights

A mid-year update to the Financial Markets Regulatory Outlook 2018

Halfway there

Following the release of our flagship annual Regulatory Outlook at the start of 2018, the EMEA Centre for Regulatory Strategy are pleased to provide this mid-year update, which details what has transpired in financial regulation over the first half of 2018 and what’s left to come.

Executive summary

This update discusses the major financial services regulatory developments we have seen in the first half of 2018, as well as our views on what to expect for the rest of the year. It looks back at the cross-industry and sector specific themes we explored in the 2018 Outlook to see how these have developed, and also identifies a number of emerging issues including climate change, FinTech, and culture in financial services firms.

The findings at a glance

In the six months following the publication of our Regulatory Outlook 2018, a lot has happened.

Listen to our analysis in easy five minute podcasts

To accompany the publication of our Regulatory Outlook update, we have produced a series of eight podcasts, in which Suchitra Nair interviews the Centre’s two partners, David Strachan and Andrew Bulley, providing some further insight and discussion on the range of cross-sector issues covered in the report.

Introduction

In this introductory podcast, David and Andrew set out their views on the major regulatory developments we have seen in the first half of 2018. They discuss the regulatory shift from policy development and implementation to supervision and optimisation, the wider macro-economic environment, and the rise of sustainable finance.

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Meeting multiple regulatory deadlines

This podcast focuses on the major set of regulatory deadlines firms faced in the first five months of 2015. With MIFID II, PRIIPs, benchmark regulation and GDPR now all in place, David and Andrew take stock of firms’ implementation efforts and set out what we can expect to see from regulators in the second half of the year.

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Preparing for Brexit

As we race towards the negotiations deadline, Brexit continues to be at the top of the agenda for many firms. This podcast takes stock of where the negotiations have got to, and looks ahead to see when firms can expect more clarity on issues like contract continuity and any final arrangements covering financial services.

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Supervisory spotlight on business models

With regulators putting firms’ business models under increasing scrutiny, David and Andrew discuss the approach taken by regulators and supervisors in the UK and across the EU, as well as some of the key business model pieces of work still to come.

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Data protection, innovation, and good customer outcomes

With the arrival of GDPR, data protection issues and firms’ use of data have risen up the regulatory agenda. In this podcast, David and Andrew explore what this means for firms and also look at some of other regulatory developments we have seen in relation to AI and cryptocurrencies.

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Customer vulnerability

Although not every European regulator uses the term vulnerability, regulators across the EU have a growing interest in the welfare of consumers who may have traits or circumstances which mean they are non-typical and so at greater risk of misconduct. David and Andrew discuss how this agenda has evolved over time, and also touch on of some of the specific pieces of FCA work that relate to vulnerability.

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Cyber risk and resilience

With the number of cyber-attacks on the rise, this podcast focuses on the actions regulators are taking to get firms to improve their cyber resilience. It looks at the actions taken by the ECB, PRA and other regulators, and discusses the regulatory expectations firms will continue to face from supervisors.

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Managing risk from internal models

As firms continue to make use of internal models for a growing variety of functions, this podcast takes a look at how regulators are scrutinising firms use of these models, across both the banking and insurance sectors. David and Andrew discuss the positions of EIOPA and the PRA, as well as the new IFRS 17 accounting standards and the ECB’s TRIM exercise.

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Revisit the original 2018 Outlook

You can access our Financial Markets Regulatory Outlook for 2018 (published in December 2017), breakdown its findings and watch a webcast on the key findings at the Outlook’s webpage here.

Regulatory timeline tool

Access our interactive timeline tool to receive a high-level view of recent and upcoming regulatory milestones for the financial services industry.

About the EMEA Centre for Regulatory Strategy

The Deloitte Centre for Regulatory Strategy is a powerful resource of information and insight, designed to assist financial institutions manage the complexity and convergence of rapidly increasing new regulation.

With regional hubs in the Americas, Asia Pacific and EMEA, the Centre combines the strength of Deloitte’s regional and international network of experienced risk, regulatory, and industry professionals – including a deep roster of former regulators, industry specialists, and business advisers – with a rich understanding of the impact of regulations on business models and strategy.

You can find more reports like this at Deloitte.co.uk/ECRS, where you can also sign-up for our monthly risk and regulation newsletter.

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