Welcome to the latest edition of the Financial Services SpeedRead, a collection of bite-sized updates designed to help you keep on top of key regulatory developments in financial services over the preceding fortnight. Please get in touch if you want to explore any of the topics covered in this fortnight's edition of Financial Services SpeedRead in more detail.
Financial Markets
1. ESMA publishes risk monitoring report on geopolitical and economic vulnerabilities in EU financial markets
On 10 September 2026, ESMA published its second Trends, Risks and Vulnerabilities Report of 2026, which includes an in-depth analysis of prediction markets as one of its highlighted topics. The report considers how prediction markets (platforms where participants trade contracts whose pay‑offs depend on future events) can contribute to a range of investor protection and market integrity concerns, and draws attention to the widening gap between Europe's and the US's regulatory approaches. For more information, see our LinkedIn post here.
ESMA’s work on prediction markets forms part of its broader assessment of structural developments in EU financial markets and the potential channels through which new market-based mechanisms may transmit or amplify risks. The analysis sits alongside its broader review of market-based finance, technology IPO trends and other emerging market structures during the first half of 2026.
2. ESMA consults on disclosure requirements and updates guidelines under the Prospectus Regulation
On 9 September 2026, ESMA published a package of materials under the Prospectus Regulation to reflect changes introduced by the Listing Act, as part of its simplification and burden-reduction efforts. The package includes a consultation paper on updated disclosure requirements guidelines, updated Q&As, a final report on guidelines for product supplements and a final report on regulatory technical standards (RTS) on key financial information in prospectus summaries. The guidelines on product supplements will apply when the translations into all official EU languages become available. Further, ESMA has submitted the Final Report on RTS to the European Commission for a decision on whether to adopt the RTS updating Commission Delegated Regulation 2019/979.
The consultation paper proposes the following key changes:
- deletion of several guidelines, including those on the operating and financial review, capital resources, and capitalisation and indebtedness, where corresponding disclosure requirements have been removed from the Commission Delegated Regulation;
- introduction of two new guidelines on management reports, requiring persons responsible for a prospectus to ensure consistency between the management report and the rest of the prospectus;
- incorporation of existing guidance on profit forecasts and estimates into the guidelines; and
- consolidation of the guidelines on risk factors under the Prospectus Regulation into the main disclosure guidelines.
Stakeholders are invited to respond to the consultation by 9 November 2026. ESMA expects to publish the final report and updated guidelines in Q1 2027.
3. FCA publishes Primary Market Bulletin 65
On 28 August 2026, the FCA published Primary Market Bulletin 65, its latest newsletter for primary market participants. Key points addressed in the bulletin include:
- publication of policy statement CP26/31 on the UK equity consolidated tape and consultation paper CP26/30 on equity market transparency, open until 16 October 2026;
- a warning to issuers against using regulatory announcements as marketing materials, citing concerns about vague, exaggerated and potentially misleading language;
- a review noting sponsors are taking more tailored approaches to expert reporting for new admissions since the July 2024 listings reforms;
- observations on inconsistent practices in the classification and handling of inside information under UK MAR; and
- a new inside information declaration form for listings document submissions via the Electronic Submission System, required from 21 September 2026.
Banking and Prudential
4. ECB publishes updated guide on licence applications for credit institutions
On 18 September 2026, the European Central Bank published an updated Guide to licence applications, setting out the assessment criteria and procedures for licensing credit institutions within the Single Supervisory Mechanism (SSM).
The Guide replaces the 2019 edition and applies to all applications for a licence to become a credit institution under the Capital Requirements Regulation (CRR), including, but not limited to, initial authorisations for credit institutions, bridge bank applications and licence extensions. It serves as a non-binding tool to promote transparency and consistency in the licensing of credit institutions across SSM jurisdictions.
The Guide will be regularly reviewed to account for ongoing developments in supervisory practices, regulatory changes, and interpretations of the Capital Requirements Directive.
5. EU Commission adopts delegated regulation on temporary market risk operational relief measures
On 11 September 2026, the EU Commission published Delegated Regulation (EU) 2026/1221, amending the Capital Requirement Regulations ((EU) No 575/2013) to introduce temporary operational relief measures and targeted multipliers for the calculation of institutions' own funds requirements for market risk. The delegated regulation addresses competitive distortions arising from delays in the implementation of the Fundamental Review of the Trading Book standards by other Basel Committee member jurisdictions.
Institutions may, until 31 December 2029, use the alternative internal model approach for trading desks that do not pass the profit and loss attribution test and treat a greater number of risk factors as modellable under a relaxed non-modellable risk factor framework. A 0.9 multiplier applies to own funds requirements calculated under the alternative standardised approach and the simplified standardised approach. Institutions adversely affected by the new market risk rules may also apply a bank-specific multiplier, recalibrated quarterly, to cap the capital impact at Basel 2.5 levels.
The delegated regulation enters into force on the day following its publication in the Official Journal and applies from 1 January 2027. The relief measures expire on 31 December 2029.
6. EU Commission adopts technical standards on operational risk calculations and reporting mapping
On 3 September 2026, the EU Commission published two closely related regulations that flesh out the operational risk framework under the Capital Requirements Regulation.
Delegated Regulation (EU) 2026/1167 sets out regulatory technical standards for calculating the business indicator used in operational risk capital requirements, including detailed rules on sub-item composition, loss event classification for larger institutions (those with a business indicator of EUR 750 million or more), and adjustments to capital requirements following corporate restructuring events such as mergers, acquisitions, or disposals.
Complementing this, Implementing Regulation (EU) 2026/1166 maps each business indicator component - covering interest, dividends, fees and commissions, trading and banking book items, and other operating income and expenses - to the corresponding FINREP supervisory reporting template cells, requiring institutions to adjust reported values where an exact match is not available.
Both regulations enter into force on 23 September 2026.
7. EBA consults on revised technical standards for reclassification of investment firms as credit institutions
On 25 August 2026, the EBA published a consultation paper on three draft regulatory technical standards (RTS) on the reclassification of investment firms as credit institutions when they exceed the EUR 30 billion total assets threshold. The RTS reflect 2024 amendments to the Capital Requirements Directive, which narrow the scope of the threshold calculation to EU-domiciled entities. The proposals clarify:
- how total assets should be calculated against this threshold;
- how investment firms should report this information to competent authorities; and
- the conditions under which competent authorities can decide to grant a waiver.
The consultation closes on 25 November 2026.
Fund Management
No recent updates.
Senior Managers and Governance
8. EBA publishes guidelines on third-party risk management for non-ICT services
On 18 September 2026, the EBA published its final report on guidelines for the sound management of third-party risk related to non-ICT services. The guidelines replace the 2019 EBA Guidelines on outsourcing arrangements, broadening the framework to cover all third-party arrangements and aligning it with DORA. It therefore extends beyond outsourcing to all non-ICT third-party arrangements, with stricter requirements for those supporting critical or important functions.
A two-year transitional period will apply for reviewing existing arrangements that support critical or important functions.
9. Robin Crispin Odey v FCA: Upper Tribunal upholds ban and reduces fine for lack of integrity
On 14 September 2026, the FCA published the Upper Tribunal's decision in Robin Crispin Odey v Financial Conduct Authority, upholding a prohibition order banning Mr Odey from the financial services industry and imposing a reduced financial penalty of £1,529,374.
Mr Odey was the founder and majority owner of Odey Asset Management LLP (OAM). Between December 2021 and November 2022, he twice removed OAM's Executive Committee and threatened executive directors in order to frustrate an internal disciplinary process into his alleged breaches of a final written warning issued to Mr Odey for repeated and persistent inappropriate behaviour towards female employees.
The Tribunal upheld all of the FCA's allegations, finding that Mr Odey's actions were motivated by self-interest, demonstrated a reckless disregard for OAM's governance and regulatory obligations, and risked entrenching a culture where inappropriate behaviour was normalised. His dealings with OAM, its investors and the FCA also lacked candour, which included false assertions to and threatening behaviour towards the FCA's staff. Throughout the trial, Mr Odey was found to have lacked credibility, and demonstrated a lack of understanding as to why his conduct lacked integrity.
The Tribunal reduced the FCA's proposed fine from £1,835,200 to £1,529,374 after deciding that no uplift for aggravating factors should apply. The prohibition order was upheld in full.
Financial Crime
10. UK Government publishes Anti-Money Laundering and Asset Recovery Strategy 2026–2029
On 16 September 2026, the UK Government published the Anti-Money Laundering and Asset Recovery Strategy 2026–2029, setting out its approach to tackling money laundering and recovering criminal assets over the next three years.
The strategy is structured around three pillars: (i) Target; (ii) Integrate; and (iii) Empower – aimed at focusing effort on the highest-harm threats, improving cross-system co-operation and strengthening enforcement capability.
By the end of the three years, key measures within each pillar include:
Target
- the FCA will become the AML/CTF supervisor for legal, accountancy and trust and company service providers, reducing the number of supervisors from 25 to three;
- the FCA, HMRC and Gambling Commission will operate under updated and strengthened enforcement powers.
Integrate
- a new National Financial Intelligence Service will be created within the NCA to improve detection and disruption of illicit finance;
Empower
- HM Treasury will consult on reforms to the Money Laundering Regulations to reduce low-value compliance activity; and
- the Government will consult on strengthening supervisory enforcement powers and on closing gaps in the regulatory perimeter.
The Government will publish progress reports mid-way through and at the end of the strategy period.
11. FATF publishes report on risks of gaming and gambling
On 9 September 2026, the Financial Action Task Force (FATF) published a report on "Risks of Gaming and Gambling", accompanied by red flag risk indicators for the gaming and gambling sectors. The report updates the FATF's previous 2009 analysis of money laundering, terrorist financing and proliferation financing risks across casinos, gambling and gaming, to reflect the expansion of online, cross-border and multi-product platforms (for example, the growth of prediction market platforms).
Key findings of the report include:
- brick-and-mortar and online casinos and sports betting are particularly exposed to money laundering risks, while terrorist financing risks are more prevalent in the online gaming space;
- payment methods such as cash, e-wallets, mobile money and virtual assets are vulnerable to a range of money laundering risks;
- illegal and unlicensed offshore gambling rivals or exceeds the legal market in some countries; and
- social media and digital platforms increasingly interlink with gaming and gambling, heightening money laundering and terrorist financing risks.
The report recommends that jurisdictions strengthen licensing requirements, improve risk awareness and enhance international co-operation to address these risks.
Retail Services
12. FCA publishes speech on building a stronger UK investment culture
On 18 September 2026, the FCA published a speech delivered by Lucy Castledine, director of consumer investments at the FCA, at the 2026 Investor Summit in London. The speech outlines the FCA's approach to supporting growth and wider access to investments, promoting simpler and clearer consumer communications, and strengthening action against scams and illegal financial promotions.
The speech covered the following topics:
- Artificial intelligence (AI): the risks that arise when using AI for financial advice or decision making, with almost half of young people who use AI to support their investing decisions mistakenly believing that AI-generated financial information is regulated;
- Targeted support: the progress since the targeted support regime went live in April 2026, with nine firms having since been authorised to provide it, including Monzo;
- Ongoing advice services: the FCA's plans to publish a policy statement by the end of 2026 on final changes to its rules on ongoing advice services;
- Consumer Composite Investments: the new Consumer Composite Investment regime and the freedom it provides firms to design product information around their customers’ needs; and
- Online scams: illegal content appears online, moves between accounts and reaches people before it is removed, hence the FCA is working closely with Ofcom on its fraudulent advertising codes project (Ofcom's consultation on this matter closes on 2 October 2026).
The FCA will continue its engagement to deliver a stronger investment culture in the UK, with further related publications planned in 2026-2027.
13. High Court dismisses spread betting claims based on gambling addiction
On 7 September 2026, the High Court handed down its judgment in Grogan v IG Index Ltd [2026] EWHC 1998 (Ch), dismissing all claims brought by an individual against spread betting provider IG Index Ltd. The claimant alleged the defendant should not have opened his spread betting account or should have closed it earlier, on the basis that he was a self-described "gambling addict", having lost over £1 million between 2018 and 2022. He claimed the defendant breached its appropriateness obligations under COBS 10A, failed to identify him as a vulnerable customer, and failed to act in his best interests under COBS 2.1.1R.
Following precedent cases, the court held there was no ongoing duty to reassess appropriateness. On vulnerability, the court found the claimant had not disclosed a gambling addiction and his trading pattern did not oblige the defendant to close the account. The court also rejected claims based on fiduciary duty. The claim was dismissed in its entirety.
Digital Finance and Fintech
14. FCA publishes policy statement on the cryptoasset perimeter
On 16 September 2026, the FCA published Policy Statement PS26/18 setting out guidance to help firms understand how the law underpinning the UK's future cryptoasset regime applies to their business. The guidance follows the FCA's finalisation of its rules and guidance in June 2026 and legislation set out by the Government in February 2026 to bring cryptoassets into UK regulation. The regime comes into force on 25 October 2027.
The guidance addresses the following key areas:
- activities which may require FCA authorisation, including issuing qualifying stablecoins, operating cryptoasset trading platforms, dealing and arranging deals, safeguarding cryptoassets and arranging cryptoasset staking;
- the Government's targeted amendments to the existing legislation, introducing exclusions and clarifications on the scope of the regulatory perimeter (see entry 15 below); and
- a planned FCA consultation in October 2026 on targeted updates to the guidance in light of the above targeted amendments.
15. HM Treasury lays draft Financial Services and Markets Act 2000 (Cryptoassets) (Miscellaneous Amendments) Regulations 2026 before Parliament
On 15 September 2026, the Government laid before Parliament a draft statutory instrument (the Financial Services and Markets Act 2000 (Cryptoassets) (Miscellaneous Amendments) Regulations 2026 (the Regulations)) which makes targeted amendments to the UK's developing regulatory framework for certain cryptoassets.
Among other changes, the statutory instrument excludes activities involving UK qualifying stablecoins from the cryptoasset dealing and arranging regulated activities, although lending and borrowing activities involving such stablecoins remain in scope. The temporary holding of UK qualifying stablecoins is also excluded from the cryptoasset safeguarding activity where held in connection with a payment transaction. Further exclusions for proprietary trading, market making and certain technical services are introduced, with corresponding amendments set to be made to the financial promotions regime.
16. FCA publishes call for input on tokenised gold in UK wholesale markets
On 14 September 2026, the FCA published a call for input exploring the opportunities and risks of tokenised gold for UK wholesale financial markets. The publication follows a joint paper with the BoE on the future of tokenisation, to which respondents highlighted gold as a key use case given the international strength of London's spot gold trading market.
Key points addressed in the call for input include: the potential for tokenised gold to serve as wholesale collateral, enabling faster settlement and reduced reconciliation risks; the legal and regulatory questions on token-holder rights, insolvency treatment and settlement finality; and uncertainty around the collective investment scheme and alternative investment fund perimeter and its impact on tokenised gold use cases.
Responses to the call for input are due by 23 October 2026.
17. FCA and BoE publish feedback statement on tokenisation in wholesale financial markets
On 14 September 2026, the FCA and the BoE published a feedback statement (FS26/1) summarising responses to their joint Call for Input on tokenisation in UK wholesale financial markets. The Call for Input, published in May 2026, set out the authorities' joint ambition to enable tokenisation, building on HMT's Wholesale Financial Markets Digital Strategy.
The feedback statement highlights the following key themes from the responses:
- collateral mobility was the most frequently cited use case, with respondents seeking clarity on the eligibility of tokenised assets as collateral.
The FCA and BoE seek to progress work on tokenised collateral, including considering the eligibility of tokenised assets like stablecoins as collateral in the Bank's Sterling Monetary Framework operations; - respondents called for faster progress, clear timelines and a move beyond sandboxes towards full production and permanence.
The FCA/BoE acknowledge this and will seek to provide clear dates and detail on key workstreams, noting that some workstreams come with external dependencies; - most respondents favoured aligning safeguarding requirements for relevant specified investment cryptoassets (RSICs) with CASS 6, with targeted overlays for blockchain-specific risks; and
- respondents emphasised the importance of legal, regulatory and cross-jurisdictional interoperability, beyond technical standards alone.
The FCA and BoE intend to publish a joint Tokenisation Roadmap later in 2026 and the FCA plans to consult on custody rules for RSICs in the first half of 2027.
18. FCA publishes multi-firm review on frontier AI and cyber resilience
On 2 September 2026, the FCA published insights from a multi-firm review examining how frontier AI may affect firms' cyber resilience, governance and vulnerability management. The review follows the FCA's May 2026 joint statement that frontier AI models represent a step-change in capability with significant implications for cybersecurity and operational resilience. Key themes from the review include:
- frontier AI is accelerating vulnerability discovery faster than firms' ability to respond, increasing pressure on remediation processes;
- organisational readiness, including governance, risk ownership and engineering capacity, is the primary challenge firms face;
- the effectiveness of frontier AI depends less on the model and more on the governance, controls, human oversight and operational environment surrounding it; and
- traditional vulnerability prioritisation approaches are being challenged, as frontier AI can reveal relationships between vulnerabilities not visible through conventional testing.
The FCA encourages firms to consider the findings in the context of their own arrangements and to review further resources referenced in the publication.
Payments
19. HMT announces new secondary innovation objective for Bank of England on payments regulation
On 27 August 2026, HMT announced its intention to give the BoE a new responsibility (by way of a secondary objective) to support innovation in payment systems and emerging forms of digital money. This will extend the BoE's current secondary innovation objective for central counterparties and central securities depositories, introduced through the Financial Services and Markets Act 2023, and sit below the BoE's primary financial stability objective, meaning that the BoE would not be required to support innovation where doing so would undermine financial stability. As part of this objective, the BoE will report annually to Parliament on how it is advancing the innovation objective.
The Government expects to implement this change through amendments to the Financial Services and Markets Bill, which will next be debated in the House of Lords on 7 and 9 September 2026.
ESG
No recent updates.
Other
20. FCA publishes lessons for firms from the Defence, Security, and Resilience Lab
On 7 September 2026, the FCA published lessons for firms from its Defence, Security, and Resilience (DSR) Lab, held in partnership with the Ministry of Defence. The DSR Lab brought together around 120 leaders from financial services, government and defence to explore systemic risks and resilience through a scenario involving satellite spoofing, subsea cable damage and a cyberattack. Key findings from the DSR Lab include:
- firms may understand their own vulnerabilities but the exercise revealed gaps in identifying shared, system-level risks;
- multiple shared dependencies exist across firms, including communications networks, satellite systems and subsea cables;
- firms want clearer signals on national threats before committing capital to resilience investment; and
- there is appetite for stronger cross-industry collaboration to tackle shared risks.
The FCA plans to further investigate intelligence sharing with the financial sector and whether more focus is needed on back-up technologies for use during disruption.
Authors: Jake Green, Partner; Bradley Rice, Partner
