Issue 32
June 2025
Welcome to the MBA's News Digest!
Dear readers,
Clean bill of health for Croatia, Mali and Tanzania at the latest FATF plenary, while Bolivia and the Virgin Islands (UK) are added to the list of jurisdictions under increased monitoring.
Carbon neutrality by 2050? Switzerland’s ambitious target presents banks with outstanding opportunities to play an active role in the country’s progress.
Regulation is no longer something that happens to banks – it’s shaping how they operate from the inside, reads an opinion piece by UK Finance.
Best wishes,
The MBA team
Outcomes of Joint FATF-MONEYVAL Plenary
13 June 2025
“The Plenary decided to remove Croatia, Mali and the United Republic of Tanzania from the FATF list of jurisdictions under the increased monitoring following successful on-site visits, and updated statements on ‘high-risk and other monitored jurisdictions’. Bolivia and the Virgin Islands (UK) were added to the list of jurisdictions under increased monitoring.”
“The FATF suspension of the membership of the Russian Federation continues to stand. Following the statements issued since March 2022, the FATF reiterates that all jurisdictions should be vigilant to current and emerging risks from the circumvention of measures taken against the Russian Federation in order to protect the international financial system.”
New policy paper: social cooperation as a basis for the climate transition
27 May 2025
‘Switzerland has set itself the ambitious target of achieving carbon neutrality by 2050 in line with the 2015 Paris Agreement on climate change. This presents banks with outstanding opportunities to play an active role in the country’s progress by providing the requisite financing instruments and resources. This role is centred on promoting sustainable investments, funding innovation and green technologies, and thus supporting the real economy in its transition to a low-carbon future.’
Fraud continues to pose a major threat with over £1 billion stolen in 2024
28 May 2025
‘Criminals stole £1.17 billion through unauthorised and authorised fraud in 2024, broadly unchanged from 2023. Banks prevented £1.45 billion of unauthorised fraud through advanced security systems. 70 per cent of authorised push payment (APP) fraud cases started online and 16 per cent started through telecommunications networks. The financial services sector remains at the forefront of efforts to protect customers, including partnering with other sectors, government and law enforcement to prevent and disrupt this criminal activity and bring perpetrators to justice.’
From data to decision: how agentic AI is revolutionising lending workflows
3 June 2025
‘The integration of Agentic AI in lending processes can not only reduce review cycle times by up to 60 per cent, as per a recent McKinsey report, but can also enhance accuracy and operational scalability by leveraging data from multiple sources. This approach empowers financial institutions to deliver faster processing times, improved customer experiences, and more consistent decision-making, ultimately gaining a competitive edge in the market. Early adopters of Agentic AI are 1.8 times more likely to improve gross margins and productivity, and these benefits will be especially felt in complex processes like underwriting, so lenders should act quickly to leverage its use.’
Navigating the EU AI Act: a strategic approach for financial services
4 June 2025
‘The EU AI Act presents both challenges and opportunities for the financial services industry. By understanding and adhering to the act’s requirements, FSIs can leverage it as a catalyst for innovation and ethical AI deployment. FSIs must act now to align their AI strategies with the regulatory demands. Beginning with thorough audits of your AI systems, establish stringent governance frameworks, and invest in continuous monitoring and staff training. Proactive measures today will ensure compliance and pave the way for ethical and transparent AI implementation.’
Nine things we learned from banks when we asked them about balancing resilience and growth : Part 1
6 June 2025
‘Regulation is no longer something that happens to banks – it’s shaping how they operate from the inside. From Basel IV and stress testing to AML requirements, regulatory demands now influence how institutions structure systems, allocate capital, and design controls. In response, banks are formalising risk frameworks, enhancing early warning systems, and investing in model validation and audit infrastructure. In some cases, regulatory scrutiny has prompted capital raises, lending diversification, or strategic shifts in operating models. A Head of Wholesale Lending told us, “We don’t see regulation as a burden – it’s part of doing business.” Increasingly, leading banks are moving from a compliance mindset to a proactive one – embedding regulatory thinking into everyday strategy to stay ahead, not just stay in line.’
Nine top tips for selecting software provider
10 June 2025
‘The US has been slower to endorse open banking than other jurisdictions. Even though the Dodd-Frank Act of 2010 envisaged the creation of an open banking framework, it was not until October 2024 that the Consumer Financial Protection Bureau (CFPB) finalised a rule to put open banking into practice. The CFPB’s rule requires many types of financial institutions—most notably banks and payments providers—to make consumer data available on request and without charge to the consumer or an authorised third party, and to establish and maintain interfaces to receive and respond to requests for covered data. It also establishes a process for industry standard-setting bodies to promulgate data security and privacy standards governing the regime.’
Key questions and decisions bankers face in response to ransomware attacks
10 June 2025
‘Of course, the big question is whether the bank should pay the ransom. There are many factors to consider including whether the payment of the ransom results in the return of decrypted data and whether that bank could be further victimized. Federal authorities strongly discourage the payment of ransoms; however, not all payments are necessarily illegal. It is important to know who would receive or benefit from the ransom payment. There is a risk the ransomware payment could involve a person on the sanctions lists of the Department of the Treasury’s Office of Foreign Assets Control or a comprehensively embargoed jurisdiction, and a bank’s risk-based approach to sanctions compliance should account for that risk. Violations of OFAC regulations are assessed on a strict liability basis and can result in steep civil or criminal penalties.’
Public comment sought on plan to phase out U.S. Treasury paper checks
30 May 2025
‘The Treasury Department is taking public comment on plans to implement President Trump’s executive order directing it to no longer issue paper checks for disbursements, including tax refunds, vendor payments, benefit payments and intergovernmental transfers. Beginning Sept. 30, all federal payments that are currently made by paper check will be made electronically, the Treasury Department said. The department’s request for information is seeking public feedback on the change, including why individuals and organizations continue to use paper checks. It is also seeking feedback on how to increase public awareness to help consumers, including unbanked and underbanked populations, transition to digital payments.’
Australian banks may cut mortgage broker reliance to boost profitability
10 June 2025
‘Australian banks are expected to try and steer borrowers away from mortgage brokers to their in-house channels in their search for better returns, according to S&P Global Ratings. Banks are reportedly heavily investing in their proprietary channels to regain ground from brokers, who originate around 60% to 70% of their new mortgage lending, said S&P credit analyst Simon Geldenhuys. By driving more customers to in-house channels— like branches, call centers or, increasingly, digital channels— banks could boost profitability.” Less mortgage origination through brokers, all else equal, means better returns for banks and potentially better pricing for borrowers,” said Geldenhuys.’
Digital token firms serving foreign clients must obtain a license: MAS
9 June 2025
‘The Monetary Authority of Singapore (MAS) clarified that even digital token service providers (DTSPs) providing services to customers outside Singapore are required to be licensed. Singapore’s regulator said in a statement that money laundering risks are higher in such business models. “If their substantive regulative activity is outside of Singapore, MAS is unable to effectively supervise such persons,” MAS said. Existing DTSPs in the city who serve only overseas customers, and who do not have a license from MAS, will be required to cease activity by 30 June 2025.’
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