Global Regulator & Central Bank News Roundup

The Monetary Authority of Singapore is conducting a proof of value with banking industry partners, the Government Technology Agency of Singapore and the Singapore Police Force to test artificial intelligence and machine learning for pre-emptive scam detection. The exercise combines data from five banks to build more robust models that can better identify higher-risk transactions and accounts, supporting earlier assessment and intervention to reduce customer losses from scams. To support the exercise, MAS has set up a secure data-sharing environment and framework with policies and protocols for customer data protection. Data used in the proof of value will remain confidential and be protected with cryptographic techniques, bank account numbers will be hashed so only the contributing bank can identify the underlying accounts, access is limited to authorised personnel in a controlled and continuously monitored setting, and all data will be deleted at the end of the exercise. After assessing the effectiveness of the proof of value and the lessons from it, MAS may expand the scope and sophistication of the models, including by using broader datasets and covering additional use cases for preventing and countering financial crime.

The Securities and Exchange Board of India (SEBI) in a newly released advisory has announced that it has constituted the cyber-suraksha.ai task force to coordinate the securities market’s response to cybersecurity risks from artificial intelligence-led vulnerability detection tools such as the forthcoming model Claude Mythos. The task force includes representatives from market infrastructure institutions (MIIs), qualified registrars to an issue and share transfer agents (QRTAs), qualified regulated entities (QREs) and other stakeholders. It is mandated to examine the risks posed by AI models, develop a uniform mitigation strategy, share threat intelligence and vulnerability management practices, report relevant cyber incidents and attack vectors, and review the cybersecurity posture of third-party application service providers. Under the same advisory, SEBI also set out additional mitigation measures for regulated entities, requiring them to strengthen vulnerability management, patching, monitoring, API security, risk assessment and third-party oversight in light of the speed and scale with which such tools can identify and potentially enable exploitation of existing weaknesses.

The Hong Kong Monetary Authority has launched the Cargo x Pilot Programme, bringing together 21 banks to test the use of cargo and trade data through the Commercial Data Interchange data infrastructure. The programme will run a series of pilot transactions to validate how integrated trade data can support trade finance digitalisation and improve financing access for Hong Kong small and medium-sized enterprises, particularly importers and exporters. The pilots form part of the authority’s implementation of the 20 recommendations under the Data, Infrastructure and Connectivity pillars of the Project Cargo x Recommendation Report published in January 2026. Projects planned for 2026 and 2027 will focus on four areas: connecting with key cargo and trade data platforms, combining SME trade flow and cash flow data for banks’ multi-dimensional credit assessment, adopting Digital Corporate Identity for trusted data sharing, and strengthening connectivity with key trade corridors. The participating banks, all with material trade finance businesses, have set up dedicated cross-functional taskforces to support the work alongside government agencies and industry stakeholders.

The European Securities and Markets Authority published two reports advancing its simplification and burden reduction agenda for EU regulatory reporting. For funds, ESMA recommends replacing fragmented and overlapping national, supervisory and statistical reporting with a single modular EU template, common data definitions and a report-once-use-many-times data flow. For transaction reporting, it validates overlapping requirements, inconsistent definitions, fragmented channels, unsynchronised rule changes, dual-sided reporting and duplicative IT systems as key cost drivers across EMIR, MiFIR and SFTR, while narrowing further work to instrument-based simplification and a longer-term report-once model. The funds framework would first consolidate AIFMD and UCITS reporting, with later extension to MMFR, statistical reporting and potentially other fund-sector obligations. ESMA favours a layered template with core modules for all funds and targeted modules based on fund type, strategy, leverage, liquidity profile, risk relevance and events such as liquidity management tool activation. The framework would be supported by a regulatory data dictionary aligned with the Commission’s wider common data dictionary work, ISO 20022 XML reporting, standard identifiers including LEI, ISIN and CFI codes, national collection through a single designated authority and transmission to an ESMA-maintained central hub for validation, storage, data sharing and common analytics. For transaction reporting, ESMA’s interim review reflects feedback from 108 responses and reframes the guiding principles as preserving information value, reducing overlaps, pursuing global alignment and balancing costs and benefits. Scenario 1b and Scenario 2b attracted little support and are being dropped, while Scenario 1a may provide medium-term relief through options such as clearer ETD and OTC derivatives delineation, dual-sided reporting reform, reduced reconciliation burdens, and targeted Level 1 changes on issues such as historical corrections, SFTR settlement-fail reporting, central-bank SFTs, corporate actions and intragroup EMIR reporting. Scenario 2a remains the preferred long-term target for integrated EMIR, MiFIR and SFTR reporting. ESMA expects to consult on funds reporting technical standards later in 2026, deliver draft AIFMD and UCITS RTS and ITS by April 2027, begin IT development in 2027 subject to funding, and go live no earlier than the first half of 2029. For transaction reporting, it plans an open hearing on 28 May and final recommendations with an independent cost-benefit analysis by July 2026.

The European Central Bank has published an updated compendium of good practices for climate and nature risk management, based on information observed up to the end of 2024, to support institutions in applying proportionate practices. Notably, the update shows that significant institutions have moved beyond initial risk identification toward more integrated frameworks, with practices linking materiality assessments, prudential transition planning, strategic and sectoral targets, risk appetite, client engagement, product offering and ICAAP. The ECB also identifies more granular use of client transition plan assessments in risk classification and financing decisions, transition finance frameworks for hard-to-abate sectors, physical risk KRIs and insurance data in collateral and credit processes, and dedicated approaches for reputational, litigation and expected credit loss impacts. The ECB also highlights that nature-related risk management is emerging but less mature than climate risk practice. Institutions are starting to assess dependencies, biodiversity impacts, water stress, deforestation, pollution and land use through sensitivity metrics, sector policies, due diligence, client scoring and selective scenario analysis, although many approaches still stop short of fully quantifying financial impact.

The Eurosystem published its response to the European Commission’s targeted consultation on EU banking sector competitiveness, calling for reforms that improve banks’ ability to scale and compete while preserving resilience. The response identifies financial and regulatory fragmentation, including the incomplete banking union, as a core constraint on euro area banks and argues that simplification should mean harmonisation rather than deregulation. The main proposals include concrete steps towards a European Deposit Insurance Scheme with a clear implementation timetable, freer movement of capital and liquidity within cross-border banking groups subject to safeguards, further harmonisation of prudential rules by shifting more of the framework from directives to regulations, and progress on the savings and investment union. The Eurosystem also proposes simplifying the macroprudential capital stack into a non-releasable buffer and a releasable buffer, closer alignment of MREL and TLAC without reducing gone-concern resources, more proportionality for small and non-complex institutions, and a more integrated European reporting framework. The response incorporates the High Level Task Force on Simplification recommendations endorsed by the ECB Governing Council in December 2025. It also sets out ECB Banking Supervision’s four-pronged agenda to make supervision more efficient, effective and risk-based, including SREP reform, operational efficiency initiatives, work on a unified SSM supervisory culture and assessment of supervisory effectiveness."

The Bank of France and France's Ministry of the Economy have launched the national register of accounts reported for fraud risk, a new database maintained by the central bank that allows payment service providers to share alerts on IBANs linked to accounts that may be used by fraudsters. The launch follows publication of the implementing measures for the 6 November 2025 law aimed at strengthening the fight against banking fraud, and is intended to improve detection and prevention of transfer fraud across the payments ecosystem. Payment service providers will supply data to the register, with banks expected to be the main users. The file is designed to strengthen vigilance against manipulation-based fraud by enabling firms to flag suspicious accounts through their bank details. The authorities said no personal data will be recorded in the register and that stored data will be retained only for a limited period. The new tool complements other anti-fraud measures promoted through the Observatory for the Security of Payment Means, including confirmation of payee, number authentication mechanisms and public awareness campaigns. Over time, the register is intended to be integrated into a broader European data-sharing framework for combating fraud under the future European Union regulation on payment services.

The Bank of Spain has launched Mi CarpetaBE, a new personal digital space that lets members of the public consult information arising from their relationship with the central bank in a more accessible, clear and centralized way. In its first phase, users can access documents they have submitted through the Electronic Register, electronic notifications and communications issued by the Bank of Spain, and a function to verify the authenticity of electronic documents using the Secure Verification Code. Access to Mi CarpetaBE requires digital identification to protect the security, confidentiality and integrity of the information consulted. Future developments will expand the information and services available through the application, including a calendar of appointments requested by the user and management of procedures included in the Bank of Spain's Electronic Office. The launch forms part of the Strategic Plan 2030 initiative Un Banco conectado, which is aimed at modernizing digital administration and the user relationship with the institution.

The Swedish Financial Supervisory Authority has announced an in depth analysis of connections between Swedish banks and private credit, as well as the role private credit plays in the Swedish financial system. The review will focus on lending outside the banking sector and the bond market, an area that has grown globally over the past decade, particularly in the United States and the United Kingdom. The authority said it has monitored the development for some time and has not so far identified indications of material risks linked to private credit in a Swedish context. However, given further development in the global market in recent years, the analysis will examine what interlinkages may exist between Swedish banks and relevant private credit market participants.

The UK Financial Conduct Authority (FCA) has announced the launch of a review of the claims management market after concerns that some claims management companies and law firms are failing consumers. The review, conducted with the Solicitors Regulation Authority (SRA) and other regulatory partners, will assess whether consumers receive fair value, whether existing price caps remain fit for purpose where free redress routes exist, and whether fee structures, funding and insurance arrangements create conflicts of interest or poor outcomes. It will also examine lead generation, marketing and advertising across the end-to-end consumer journey, differences across regulatory regimes, and whether firms have the appropriate permissions. The FCA will look at firms it regulates, including lead generators, as well as firms authorised by others. The FCA stressed said it will continue interventions through the joint regulatory taskforce on motor finance claims, including action on misleading advertising, sign-up processes, meritless claims, multiple representation, and firms’ financial and operational resilience. The FCA has removed or amended 800 misleading adverts, enabled more than 28,000 consumers to exit contracts free of charge, and secured fee reductions by three claims management companies. The SRA on its part has 109 open investigations relating to 76 firms managing high-volume consumer claims and has closed seven firms in this area.

The Dubai Financial Services Authority has launched a public consultation on proposed changes to its Islamic finance framework in the Dubai International Financial Centre. The proposals would clarify when Authorised Firms and Authorised Market Institutions need an Islamic endorsement and would strengthen disclosure requirements for Takaful sales. The framework continues to treat the DFSA as a Shari’a systems regulator, meaning it requires firms to maintain appropriate systems and controls but does not determine whether products or services comply with Shari’a. An Islamic endorsement would be required where an Authorised Person presents all or part of its business as conducted in accordance with Shari’a, provides a Financial Service for a product it presents as Islamic or Shari’a-compliant, or manages a fund presented as Islamic or Shari’a-compliant. The proposals clarify that firms would not need an endorsement solely for providing access to, or distributing, Islamic financial products such as Sukuk or Takaful, provided they do not make Shari’a compliance representations and meet existing client protection obligations. The DFSA also proposes moving Takaful disclosure requirements into the Conduct of Business module, so that all Takaful sales include information on contract features, fee calculations, surplus-sharing arrangements and possible additional contributions.

Fundi Tshazibana, Deputy Governor of the South African Reserve Bank and Chief Executive Officer of the Prudential Authority, has urged financial institutions to embrace artificial intelligence responsibly while strengthening governance, risk management and supervisory oversight. Speaking at the University of Johannesburg, Tshazibana noted that while AI is already being actively used across the financial sector and offers major opportunities to improve productivity, customer service and risk monitoring, she warned that it also introduces new vulnerabilities, highlighting five major AI-related vulnerabilities based on the Financial Stability Board's monitoring framework: growing dependence on a small number of third-party AI providers; increased cyber risks, including hacking, deepfakes and fraud; model risks such as bias, hallucinations and lack of explainability; the potential for AI-driven trading or deposit behaviour to amplify market stress; and the risk that AI systems may act in ways not intended by their operators. Tshazibana noted that reported digital bank-fraud incidents in South Africa rose by 86% between 2023 and 2024, underscoring the urgency of managing AI-enabled cyber threats. She also warned that AI could accelerate financial instability, with crises that once unfolded over days potentially playing out in minutes. She used Anthropic’s Mythos model, reportedly capable of identifying major operating-system security flaws and therefore restricted to trusted users, as an example of how frontier AI is prompting policymakers to reassess risks quickly, even where claims remain unverified. On the Prudential Authority's own approach to AI regulation and supervision, Tshazibana outlined focus on three priorities: improving information, building skills and calibrating regulation. She stressed that regulators and firms need a clearer taxonomy for AI use cases, stronger disclosure and explainability requirements, better data governance, and more insight into system-wide impacts. She also called for board-level oversight, clearer executive accountability for AI, and more robust controls around fairness testing, third-party model risk and ethical standards. Against this backdrop, she noted the ongoing work between the Prudential Authority and the Financial Sector Conduct Authority on a discussion paper setting out a regulatory approach to AI, expected early in the second half of 2026.

The Dubai Financial Services Authority announced with the United Arab Emirates Ministry of Economy and Tourism and the Capital Market Authority the launch of their first joint Quality Management audit inspections, establishing a coordinated approach to oversight of auditors across the UAE. The inspections will assess how audit firms are implementing International Standards on Quality Management 1, with the aim of promoting consistent assurance processes for financial services firms operating across multiple UAE jurisdictions. The initiative builds on recently signed memorandums of understanding between the authorities to strengthen cooperation and support information exchange on auditor oversight within their respective jurisdictions. The release describes the inspections as a first step toward closer coordination and more tailored information sharing among the authorities.

The Central Bank of Syria has published its 2026–2030 strategy, organised around five pillars: monetary stability, a transparent foreign exchange market, banking-sector soundness, secure digital payments, and renewed international financial integration. On monetary policy, the strategy focuses on restoring credibility and anchoring inflation expectations. It proposes a simplified inflation-targeting framework, a formal interest-rate corridor, stronger liquidity forecasting, and regular policy communications. It also includes reforms to cash management and the issuance of a new currency with two zeros deleted. The foreign exchange pillar seeks to move activity from informal markets into regulated channels. The strategy prioritises a unified framework for banks and exchange companies, stronger market monitoring, regulation of gold trading, and improvements to official foreign-exchange and remittance services. For the banking sector, the strategy combines prudential reform with stronger integrity and conduct supervision. Core measures include reviewing, restructuring and recapitalising banks, reforming deposit insurance, introducing annual stress testing, strengthening AML/CFT compliance, integrating beneficial-ownership data, and developing risk-based supervision. It also places emphasis on consumer protection and a national credit information bureau. The digital payments pillar is focused on building the infrastructure needed for a modern payments ecosystem. Key priorities include rapid payments, RTGS development, a national switch, government e-billing, cross-border payments, and access to global payment networks. These initiatives are supported by a proposed legal and supervisory framework for payment and fintech providers. Finally, the international integration and financial inclusion pillar aims to reconnect Syria’s financial system with global markets while expanding access to formal finance. It focuses on restoring correspondent banking relationships, improving IMF- and IFRS-aligned reporting, supporting SME finance and microfinance, reducing the cost of official remittances, and developing Islamic finance, among other things. Implementation is supported by several cross-cutting enablers including bot not limited to legal reform, central bank governance and independence, data quality, digital transformation and talent development. The release of the strategy comes amid the announcement of active efforts underway to perform a gap assessment of the Central Bank and the broader Syrian financial system.

The U.S. Securities and Exchange Commission proposed amendments that would allow public companies subject to Exchange Act reporting obligations to elect semiannual interim reporting instead of quarterly reporting. Companies that elect the option would file one semiannual report on new Form 10-S and one annual report each fiscal year, while companies that do not elect the option would continue filing quarterly reports on Form 10-Q. Form 10-S would require the same narrative disclosures and financial information as Form 10-Q, but would cover a six-month period rather than a fiscal quarter. Semiannual financial statements would be prepared under United States generally accepted accounting principles and reviewed by an auditor, but would not be required to be audited. Form 10-S would be due 40 or 45 days after the end of the first semiannual period, depending on filer status. Companies would make the election by marking a check box on Form 10-K, specified Securities Act registration statements, or Exchange Act registration statements on Form 10, as applicable. The proposal would also amend Regulation S-X to reflect the optional semiannual reporting approach in periodic reports, registration statements, and proxy statements, including by revising and simplifying rules on the age of financial statements. It would also amend transition report rules and make technical changes to existing rules and forms that refer to quarterly reporting.

The U.S. Office of the Comptroller of the Currency published its Spring 2026 Semiannual Risk Perspective, reporting that the federal banking system remains financially strong but faces key credit, market, operational and compliance risks. Bank earnings improved in 2025 on loan growth and lower funding costs, balance sheets remained strong, and aggregate credit risk stayed manageable, with first-quarter 2026 earnings releases indicating that these trends generally persisted. Total loan balances in the federal banking system grew by 6 percent from the end of 2024, while return on equity reached 12.2 percent for the system and 11 percent for community banks. Net income grew 8.8 percent for the system and 21.6 percent for community banks. The OCC highlighted refinancing risk in commercial real estate as a substantial volume of loans originated in a lower-rate environment matures over the next several years and must be refinanced at prevailing rates. Office commercial real estate is showing gradual stabilization, but some banks continue to work through legacy problem loans and banks with more than USD 250 billion in assets took additional charge-offs on office loans. Multifamily properties remain resilient despite rental rate declines in the Sun Belt, warehouse vacancy is expected to remain high in the near term, hotel performance has weakened on low room demand, and retail remains comparatively strong. In private credit, bank exposures to funds are generally performing, but weakening credit quality in some vintages, borrower types and sectors, together with increased use of restructurings and paid-in-kind mechanisms, may obscure underlying deterioration. Consumer credit stress has risen among borrowers with weaker credit scores, although OCC-supervised banks’ exposure to higher-risk consumer lending remains manageable. Operational and compliance concerns include sophisticated cybercriminal and foreign state-sponsored threats, AI-enabled cyber and fraud risks, elevated fraud and scam activity, and sanctions and Bank Secrecy Act/anti-money laundering pressures linked to geopolitical tensions.