April 2026 Articles - Suits the C-Suite

27 April 2026

Noel Andro D. Bico

How tax and incentives policy responded to the energy shock

In brief:The government responded to the 2026 energy shock by suspending excise taxes on selected fuel products and extending tax filing deadlines to ease cost pressures and support cash flows. Flexible tax and incentives policies, including temporary work-from-home allowances for registered businesses, helped balance economic relief with regulatory accountability during the crisis.“Taken together, the coordinated actions of the BIR, FIRB, and related agencies reflect a pragmatic and measured response to a period of economic stress."In early 2026, the Philippines found itself at the sharp end of a global energy shock. Geopolitical conflict in the Middle East and the temporary closure of the Strait of Hormuz disrupted the global oil trade, sharply raising energy prices across global markets. For a country heavily dependent on imported fuel, the effects were immediately tangible: rising pump prices, increased transport costs, and a growing strain on energy intensive industries. In response, President Ferdinand “Bongbong” R. Marcos, Jr. declared a state of national energy emergency, enabling a coordinated government response under existing legal frameworks to manage risks arising from global energy supply disruptions.This article examines the various issuances and policy actions undertaken by key government agencies, including the Bureau of Internal Revenue (BIR) and the Fiscal Incentives Review Board (FIRB), to stabilize economic activity amid ongoing global energy market disruptions.Excise Tax Suspension as Fiscal InterventionA central element of the government’s fiscal response to high global oil prices was the temporary suspension of excise taxes on select petroleum products, implemented under a framework authorized by Republic Act (RA) No. 12316. The law empowers the President to suspend or reduce excise taxes on petroleum products when prescribed market conditions are present, allowing fiscal policy to respond quickly to extraordinary price shocks without needing new legislation.Pursuant to this authority, Executive Order (EO) No. 114, series of 2026, signed on 16 April 2026 and circularized by the BIR under Revenue Memorandum Circular (RMC) No. 031-2026 on 17 April 2026, temporarily suspended the imposition of excise taxes on liquefied petroleum gas (LPG) and kerosene, subject to specific exclusions, for a period of three months from its effectivity. LPG remains taxable when used as a petrochemical input or for motive power, while kerosene remains taxable when used as aviation fuel.This measure directly reduced retail fuel costs for households, small transport operators, and industries reliant on LPG and kerosene.To operationalize the EO, the BIR issued Revenue Regulations (RR) No. 3-2026, which prescribe the implementing rules, compliance guidelines, and administrative safeguards governing the excise tax suspension. RR No. 3-2026 expressly provides that the temporary excise tax suspension applies only to qualified petroleum products removed from the place of production or customs custody beginning 17 April 2026. This suspension is also subject to reinstatement upon the occurrence of certain conditions.To ensure proper implementation, RR No. 3-2026 imposes specific inventory submission and reportorial requirements. Concerned manufacturers, importers, and lessees of storage depots are required to submit duly notarized inventories of all covered petroleum products as of 16 April 2026. Withdrawal Certificates must likewise bear the annotation: “STOCKS COVERED BY EO NO. 114, SERIES OF 2026.”These requirements help protect government revenues, prevent the misuse or diversion of tax exempt fuel, and ensure that excise tax relief is applied only within the allowed scope and duration of the suspension. Overall, the excise tax suspension showed a careful and lawful use of fiscal flexibility. With clear rules under RR No. 3-2026, it provided targeted and time bound relief for LPG and kerosene during a period of elevated energy costs, while maintaining the integrity and enforceability of the excise tax system.Deadline extension as administrative reliefComplementing this fiscal intervention were administrative relief measures implemented by the BIR to ease taxpayer compliance. Consistent with its long standing practice during periods of disruption, the BIR issued RMC No. 030-2026 on 14 April 2026, extending the deadline for the filing and payment of 2025 annual income tax and the submission of the required attachments from 15 April 2026 to 15 May 2026, without the imposition of surcharges, interest, or penalties. Taxpayers were likewise allowed to file electronically and settle liabilities through both digital payment channels and Authorized Agent Banks (AAB), regardless of their Revenue District Office (RDO).This extension assisted businesses in preserving cash flows while operating and energy costs were rising. For many, particularly small and medium enterprises, the one-month deferral provided short-term breathing space to meet payroll and supplier obligations. Facilitation of fuel importation and logistics supportThe BIR also played a critical role in safeguarding fuel supply by facilitating the expedited importation of petroleum products, particularly in support of procurement activities undertaken by the Philippine National Oil Company–Exploration Corporation (PNOC EC). In March 2026, the BIR, through its Large Taxpayers Service (LTS), issued special permits to PNOC EC to fast track the emergency importation of petroleum products, effectively streamlining documentary and procedural requirements. The BIR worked closely with PNOC EC to ensure the timely processing of reportorial requirements to help speed up clearance for fuel imports. By supporting PNOC EC’s fuel procurement and import logistics, the BIR helped stabilize fuel availability, highlighting its role not only as a revenue collecting agency but also as an operational partner in broader economic stabilization efforts. This role is often overlooked but proved critical during the energy disruption.Temporary work from home arrangements for registered business enterprises (RBEs)Alongside the BIR’s measures, the FIRB adopted a complementary policy aimed at sustaining business operations under constrained conditions.This policy was set out in FIRB Resolution No. 005-26, effective 24 March 2026, which allowed RBEs in economic zones and freeports to temporarily adopt work from home (WFH) arrangements without losing their fiscal and non fiscal incentives. Under the Resolution, RBEs may adopt WFH arrangements for up to 90% of their workforce directly engaged in the registered project or activity. Investment Promotion Agencies (IPAs) may set a lower threshold where business operations require on site presence, provided that the percentage does not fall below 50%.A notable exception applies to RBEs in the Information Technology–Business Process Management (IT‑BPM) sector that maintain concurrent registration with the Board of Investments (BOI). These enterprises are not subject to the same on-site workforce limitations following the 2022 precedent under FIRB Resolution No. 026‑22 that allowed them to transfer their registration from an economic zone or freeport IPA to the BOI until 31 December 2022. This transition enabled them to adopt up to 100% WFH arrangements without compromising their fiscal incentives. Accordingly, RBEs with concurrent BOI registration may continue implementing full WFH arrangements, subject to BOI-specific terms and conditions.However, safeguards are built into the framework. RBEs that exceed the WFH threshold imposed by their concerned IPA are subject to regular income tax on the excess portion, computed by averaging all excesses made by the RBE in the month of non-compliance. Strict monitoring and compliance requirements also apply. RBEs must notify their respective IPAs, submit verified inventories of equipment used for WFH, and comply with controls governing the movement of assets outside economic zones. Notably, imported assets may be temporarily transferred only with prior approval and the posting of a surety bond equivalent to 150% of applicable duties and taxes. This ensures that fiscal incentives are not abused and that government revenues remain protected.The way forwardTaken together, the coordinated actions of the BIR, FIRB, and related agencies reflect a pragmatic and measured response to a period of economic stress. More broadly, these measures illustrate the evolving role of tax and incentives policy. Beyond revenue generation and regulation, these tools can serve as instruments of stabilization capable of responding quickly, within legal bounds, and in proportion to emerging challenges.As global disruptions become more frequent, the ability to deploy responsive yet accountable policy measures will be increasingly critical. The experience of 2026 offers a compelling case for adaptive tax and incentives governance — one that balances relief with responsibility, and agility with oversight – to foster resilience, sustain business confidence and support economic stability.Noel Andro D. Bico is a Senior Director from the Global Compliance & Reporting Sub-Service Line of SGV & Co. This article is for general information only and is not a substitute for professional advice where the facts and circumstances warrant. The views and opinions expressed above are those of the author and do not necessarily represent the views of SGV & Co.

17 April 2026

Samantha Joy U. Cinco

Familiar banking risks return through new channels

In brief:Banking risk management is being shaped by interconnected risks driven by innovation, technological change, geopolitical instability, and the expanding role of private capital and non-bank finance. These forces blur the distinction between financial and non-financial risks and heighten vulnerability to shocks. As a backdrop to this, regulation is becoming increasingly fragmented and localized, adding to the overall complexity of the risk management landscape. Divergent interpretations of global standards for prudential, digital, AI, and sustainability regulations raise compliance costs, complicate risk measurements and aggregation, and constrain strategic planning. To manage risks, banks are shifting from a sole focus on capital strength toward a broader focus on resilience and capability building. “The banks that will be able to navigate these risks will not be the ones that control every risk, but those that build capabilities to anticipate change, identify transmission channels, and embed resilience in strategy, operations, and resources."Banking risk management is being shaped by threats that are non-linear, continually accelerated by technology and innovation, intensified by volatility, and tightly interconnected across markets, institutions, and jurisdictions. The recently published 15th annual EY/IFF Global Bank Risk Management Survey highlights this shift, which is influencing the agenda of chief risk officers (CROs) worldwide. The survey notes that traditional risks are making a comeback and the ways in which they emerge and transmit through banks have changed. Geopolitical tensions, technology and innovation, and the growth of private capital are also driving opportunities and exposures. At the same time, regulation is becoming more localized, increasing compliance and operational costs for banks. Together, these forces are reshaping the capabilities, resources, and strategies of banks as they navigate this landscape. This is the third article of the SGV Financial Regulatory Outlook series, which builds on insights from the SGV Knowledge Institute event titled “Global Shifts, Local Impact: Navigating the Next Wave of Banking Regulation.”Re-emerging top risks driven by innovation and macroeconomic forcesWith the promise of improved productivity, artificial intelligence (AI) is increasingly being deployed. Digitization has also allowed for better access to financial services, furthering financial inclusion for sectors of the economy that need it most. With this comes heightened concerns about cybersecurity, digital fraud, and financial crime, all reported in the survey as top risks for the world’s CROs. Additionally, geopolitical instability is seen as a powerful external force shaping risk management strategies. It moves through banks in interconnected chains. It first affects market sentiment, raising uncertainty and leading to changes in investor confidence. It then affects formal economic channels, whether through consequent trade or financial restrictions, or physical disruption. This leads to possible supply chain disruptions, rising levels of sovereign debt, a decline in aggregate demand, and an overall increase in prices that deter growth and trade. These risks then make their way into the balance sheet, affecting credit, liquidity, funding, and market risks – ultimately translating into pressure on capital adequacy. However, their impact extends beyond financial risks, also affecting overall operations and governance. In the Philippines, the recent geopolitical shock coming from the Middle East is already making waves through supply chain disruptions, placing upward pressure on the price of fuel. As a primary input, higher fuel prices will in turn increase the prices of necessities, leading to a budget squeeze and a fall in overall disposable income. Tighter budgets mean weaker debt-servicing capacity and overall credit demand. Over time, this materializes in the bank’s purview due to implications in asset quality, credit growth, and liquidity conditions. Lastly, credit risk is also making a comeback as a top concern through a combination of traditional financial concerns, rising defaults linked to geopolitical instability and market developments, and the rise of private credit. Private credit or non-bank financial institutions (NBFIs) have taken a more prominent role in the industry, raising concerns about the unregulated “shadow banking” system. In the Philippines, this is especially relevant given the rise of fintechs which, while expanding access beyond traditional financing, also expands the entities covered under non-bank finance to include startups that enable peer-to-peer lending, pool savings, and profit credit. The local environment is made even more complicated given the distinction between NBFIs with quasi-banking license (e.g. investment houses and trust companies) and those without (e.g. pawnshops and remittance companies). Regulatory fragmentation as a risk multiplierActing as an overlay to these top risks is the fragmented regulatory landscape. Global standards are being localized, leading to differing interpretations and implications. This is not only in prudential regulation, but also in the areas of AI, sustainable finance, digital assets, and payments. The shifting regulations highlight shifting priorities for localities while increasing complexities for multinational entities. According to the survey, regulatory fragmentation is seen to increase compliance and operational costs, exacerbate challenges in data management reporting, and lead to difficulties in risk aggregation and measurement. Banks will not only deal with the inherent risk of operations but also consider the costs and opportunities of doing business in specific countries or regions owing to diverging regulations. This confluence of changing top risks and regulation is pushing banks beyond balance sheet defense. Shifting strategies from strong capital to resilience and capabilitiesToday’s top risks are increasingly non-financial while also driving financial risks. Strong capital planning is indeed still necessary, but it is no longer sufficient on its own.The survey emphasizes increased resilience as a top strategy to manage geopolitical risks and diverging regulations. In the Philippines, the recent BSP Circular 1203 on Operational Resilience espouses a move beyond continuity planning, stressing the identification of critical operations and systems, mapping of dependences, definition of tolerances, scenario testing, and overall recovery capabilities. Moreover, managing this new complex risk landscape requires an emphasis on skills around new technologies as well as different team structures. According to the survey, top skillsets for risk management include digital acumen, adaptability to a changing risk environment, understanding the enabling role of risk management, having a deeper specialization in at least one domain, and critical soft skills such as leadership, communication, and collaboration. From risk awareness to risk strategiesThe risk landscape is being shaped not by a single shock, but by a convergence of multiple external shocks materializing through new and traditional risks. This is happening against a backdrop of increased regulatory fragmentation. As countries continue to prioritize localization, banks are managing compliance not as a set of global standards, but as a portfolio of specific local and regional regulations. Managing this complex environment requires a change in mindset. The banks that will be able to navigate these risks will not be the ones that control every risk, but those that build capabilities to anticipate change, identify transmission channels, and embed resilience in strategy, operations, and resources. This time is different. Resilience is not just about stability; it’s about sustained adaptability. Samantha Joy U. Cinco is a Financial Services Consulting Senior Director of SGV & Co. This article is for general information only and is not a substitute for professional advice where the facts and circumstances warrant. The views and opinions expressed above are those of the author and do not necessarily represent the views of SGV & Co.

14 April 2026

Charisse Rossielin Y. Cruz and Eleonor L. Camot

Balancing growth, innovation, and trust in Philippine banking

In brief:Philippine and Asia‑Pacific banks are prioritizing growth and upside risk management while adapting to rapid digital transformation amid rising regulatory, technological, and competitive pressuresBanks must balance innovation with trust by strengthening governance, cybersecurity, operational resilience, and legacy systems, while adopting technologies such as AI and blockchain.Long‑term success depends on future‑ready skills, adaptive leadership, and a mindset that embraces continuous change while maintaining confidence among customers, regulators, and stakeholders.“By adopting adaptive operating models, innovation friendly risk frameworks, and a mindset that treats change as constant, banks can unlock upside opportunities while reinforcing long term trust from stakeholders."Asia Pacific (APAC) and Philippine narratives continue to be about growth and dealing with upside or growth risks, as opposed to downside risks that would correctly describe economies that went through crises. Banks continue to update their decision-support, compliance, and risk management models in parallel with their transformation and innovation initiatives while meeting heightened expectations from regulators, customers, and investors. To navigate this complexity effectively, a focused and balanced portfolio will enable banks to drive synergies across the organization and unlock value from upside risk opportunities. This requires a shift from merely mitigating risks to actively embracing upside potential, grounded in a strong foundation of trust. This is the second article of the Financial Regulatory Outlook series, which builds on insights from the SGV Knowledge Institute event titled “Global Shifts, Local Impact: Navigating the Next Wave of Banking Regulation.”The previous article presented insights from the EY Global Regulatory Outlook, which was issued against a backdrop of increasingly rapid technological innovation and a changing competitive landscape that is becoming more ecosystem-based and ‘friendlier’ to non-traditional players. This environment presents new risks for banks, particularly in relation to the digital world, with big tech companies and nimbler entrants threatening profitability and making the regulatory direction less clear. This underscores the need to create both regulatory and management frameworks that strike a balance between allowing for change and innovation while ensuring financial sector stability and protecting customers and the public. However, innovation in banking is inherently challenging. Banks operate within complex business models, rely heavily on legacy core systems, and are subject to intense regulatory scrutiny. These challenges can be understood through recurring paradoxes that banks must continuously manage. The resulting tensions drive the need for banks to have more adaptive and resilient models. Managing technology risk in a digital‑first environmentDigital transformation efforts will accelerate on multiple fronts during the next five years as banks continue to embrace widespread transformation programs to meet shifting customer needs, stay ahead of new competitors and achieve operational excellence. These efforts are closely aligned with the BSP’s overarching digital transformation strategy, which encourages financial institutions to shift toward digital-first banking to improve convenience, inclusion, and efficiency. At present, major banking institutions are actively integrating artificial intelligence (AI) for fraud detection and credit scoring, as well as blockchain payment rails to streamline operations and expand access to financial services. Despite the significant opportunities presented by digital innovation, cybersecurity and technology risks – including risks associated with the design, development, and deployment of digital systems and infrastructure – remain a top priority for banks. Bank leaders continue to be confronted with the risk-vs.-opportunity paradox, particularly around AI adoption: assessing whether AI will introduce new and complex risks or strengthen the bank’s ability to identify, manage, and mitigate risk more effectively.Recognizing both the promise and the risks of innovation, regulators have introduced measures such as the Financial Services Cyber Resilience Plan (2024–2029) to promote industry-wide coordination, enhance defenses against evolving cyber threats, and safeguard stakeholder trust.Balancing innovation and growth with trust, resilience, and regulatory compliance is critical to long-term success. Achieving this balance requires banks to design and adopt innovation-friendly governance frameworks, with clearly defined risk limits, accountabilities, and decision rights embedded directly into business-as-usual operations.Dual‑track technology transformation Robust and reliable technology is essential to enable successful banking transformation and sustain continuous innovation and growth. However, while the adoption of new technologies is critical, core banking system disruptions are unacceptable, given the “always on, always available” nature of banking services and the sector’s reliance on uninterrupted operations to maintain customer trust, financial stability, and regulatory compliance.Banks operate within highly complex and interconnected environments, often reinforced by legacy core banking systems that are deeply embedded in critical business processes. Beyond managing vast volumes of sensitive customer and transaction data, important business services depend on legacy platforms, layered architectures, and extensive policy frameworks. These interdependencies heighten the risk that system changes, upgrades, or migrations may disrupt critical services, making transformation initiatives particularly challenging.Philippine banks are increasingly adopting a dual-track approach to technology transformation, balancing the need to protect mission‑critical legacy systems while simultaneously deploying new digital capabilities. Under this model, banks deploy new digital tools to enhance existing systems through familiar channels and interfaces, minimizing disruptions to day-to-day operations and reducing change risks for both customers and employees. Similarly, legacy technology can be “wrapped” with new features, functionality, and AI-based user experiences without exposing the institution to the operational and regulatory risks of full system replacement — a key consideration in the Philippine regulatory environment.Building future‑ready talent As technologies continue to evolve at pace, banks must ensure their talent keeps up to sustain transformation momentum. People are at the core of successful transformation; hence, banks need to continuously upskill their workforce to adopt emerging technologies. According to the Global Bank Risk Management Survey 2024, the APAC region faces the most significant challenges in attracting and retaining cybersecurity talent. Digital growth across the region is accelerating faster than talent development, resulting in a widening skills gap. In the Philippines and other emerging markets, there is a strong foundation of technical talent, but capability gaps remain due to limited exposure to advanced cybersecurity roles, enterprise-scale environments, and governance, risk, and regulatory frameworks. Over the next five years, risk professionals anticipate the need for more specialized skill sets across both the first and second lines of defense to address increasingly complex and fast-evolving risks. Bank leaders must therefore proactively define the skills required for the future and implement a deliberate strategy to develop and acquire these capabilities while continuing to retain and strengthen expert talent in core areas.Workforce shifts are inevitable. As AI tools increasingly meet basic analytical needs and automate routine tasks associated with traditional risks, teams are expected to move from today’s pyramid (with more workers in junior roles) to tomorrow’s diamond shapes (with more senior-level specialists with stronger judgment, domain expertise, and decision-making capabilities). As this transition accelerates, leaders must also address widespread concerns about AI’s potential to replace jobs. Successfully navigating this shift will require clear communication, targeted upskilling, and a strong focus on redeploying talent toward higher-value activities.Driving organizational adaptability While technology enables transformation, its success in financial institutions ultimately depends on people and effective leadership. While investments in digital platforms, cybersecurity tools, AI, and data analytics are critical, their impact will remain limited unless organizational culture, leadership behaviors, and ways of working evolve in parallel. Transformation success ultimately lies in how people think, act, and collaborate.As Philippine regulations increasingly focus on technology risk, cyber resilience, data governance, ESG, and AI, the ability of banks to adapt is being tested beyond traditional compliance capabilities. Meeting these demands requires not only new tools and frameworks, but also greater agility, judgment, and cross functional collaboration across the organization.To succeed, leaders must enable people to work adaptively, experiment creatively and think differently. People and teams may need convincing that continuous improvement is a requirement for long-term success and that while change is difficult, its long term benefits far outweigh the short term disruption it creates.Sustainable growth through trusted innovationAs banks continue to pursue growth through rapid digital innovation, maintaining trust and resilience is more critical than ever. The industry’s path forward will be shaped by how effectively it manages the inherent paradoxes of innovation: adopting new technologies while protecting mission-critical systems, building future ready skills while retaining core expertise, and driving continuous change without eroding confidence among customers, regulators, and stakeholders. By adopting adaptive operating models, innovation-friendly risk frameworks, and a mindset that treats change as constant, banks can unlock upside opportunities while reinforcing long-term trust from stakeholders. Charisse Rossielin Y. Cruz is a Business Consulting Partner and the Insurance Sector Deputy Leader, and Eleonor L. Camot is a Financial Services Consulting Senior Director, both of SGV & Co.This article is for general information only and is not a substitute for professional advice where the facts and circumstances warrant. The views and opinions expressed above are those of the authors and do not necessarily represent the views of SGV & Co.

06 April 2026

Ruben D. Simon, Jr.

Navigating the new global norm in financial regulation

In brief:Regulatory divergence is accelerating globally, with the US easing supervisory transitions to support competitiveness and innovation while the EU and UK maintain a stability focused approach, creating operational complexities for multinational financial institutions.Asia-Pacific regulators are pursuing market specific, stability oriented strategies and domestic market development rather than mirroring Western regulatory shifts.Technology, operational resilience, consumer protection, and emerging systemic risks are reshaping oversight, as regulators strengthen frameworks around AI governance, digital assets, fraud prevention, financial crime compliance, and the growing interconnectedness of non bank financial institutions. “At this global crossroads, regulation is no longer merely a compliance exercise. It is now a strategic determinant of an institution’s competitiveness."The global financial system is entering a period of intense structural change driven by competing political priorities, technological disruption, and diverging regulatory philosophies. If past cycles of reform were characterized by coordination and standards-setting, the current environment reflects a more fragmented, multi polar world. This is evidenced by diverging perspectives on competitiveness and innovation between the United States, United Kingdom and the European Union, underpinned by recent geopolitical and trade policies. In the Asia Pacific region, regulators gravitate towards a more cautious stance to develop their respective markets. While this is the case, there has been a common theme emerging from the current shakeup caused by the conflict in the Middle East that has caused direct impacts to energy security across the globe. Regulators are imploring financial institutions to tighten their respective scenario stress testing exercises to make sure their capital buffers are resilient enough, and calling for increased vigilance on energy shock-induced inflation, supply chain disruptions and their impact on their respective portfolios. In this situation, institutions operating cross-border transactions and those that have operations in different jurisdictions must now navigate a landscape where rules are increasingly diverging. The EY 2026 Global Financial Services Regulatory Outlook highlights this shift, along with the implications for supervision, risk management, and long-term competitiveness of financial institutions. This is the first article of the Financial Regulatory Outlook series, which will discuss insights from the SGV Knowledge Institute event titled “Global Shifts, Local Impact: Navigating the Next Wave of Banking Regulation.”Regulatory fragmentation widens as US and EU pursue divergent agendasGlobal financial regulation is becoming increasingly fragmented as major economies adopt contrasting approaches to competitiveness, innovation, and systemic oversight. The US is moving towards easing supervisory oversight focusing on capital rules, supervisory methodology, decreasing barriers to innovation, and an increased openness towards mergers and consolidation among major US Banks. This supervisory shift signals that the US is prioritizing economic expansion and domestic competitiveness over multilateral alignments that were emphasized after the Global Financial Crisis. Meanwhile, the EU and the UK are pursuing growth agendas of their own, but one anchored in maintaining stability within the existing regulatory architecture. The bloc’s decision to delay the Fundamental Review of the Trading Book (FRTB) to 2027 reflects its cautious stance, prioritizing prudential safeguards despite market and geopolitical pressures. This divergence in regulatory direction creates operational challenges for multinational banks, wherein institutions operating across the US and EU face significant asymmetries in capital requirements, reporting timelines, and supervisory expectations. As global standard setters avoid intervening in these geopolitical drivers, firms must adapt to a regulatory landscape where policy alignment is no longer guaranteed. This regulatory fragmentation appears to be the new norm rather than a transitory cycle while institutions wait for the current geopolitical uncertainties to subside.Asia-Pacific adopts market-focused, stability-oriented regulatory strategies In the Asia-Pacific, regulators are pushing for a more independent trajectory, guided by the US push for lesser stringent regulatory supervision and more by domestic priorities in innovation, regional competitiveness, and financial stability. Hong Kong and Singapore continue to lead in digital assets and sustainability standards, reflecting their continuous push for regional financial regulatory leadership. Their regulatory stance pairs innovation with strong safeguards that heavily focuses on risk assessment, operational resilience, and capturing cross border flows. Meanwhile, India is pursuing rapid financial sector development, implementing measures to boost domestic capacity and build a modern regulatory foundation suited to its expanding economy. On the other hand, Japan is emphasizing trust and system security while strengthening regional financial functions, signaling a preference for stability and predictability. Australia stands as a cautious outlier, closely tracking artificial intelligence (AI) governance and digital asset developments abroad as it evaluates potential reforms domestically. Despite their varied approaches, APAC regulators share a common orientation: to maintain resilience amid geopolitical uncertainty. Many jurisdictions are tightening cyber and operational standards, as seen in the EU aligned Digital Operational Resilience Act (DORA) efforts and new oversight regimes for critical third party service providers. This regional focus on digital resilience and local market strengthening underscores a broader shift where the Asia-Pacific is not reacting to Western recalibrations, but designing frameworks tailored to its own structural needs and competitive aspirations.Emerging risks: Technology, digital assets, and operational resilience redefine oversight Across global markets, regulators are increasingly concerned about risks arising from fast-moving technological adoption, the expansion of digital assets, and growing dependence on third party service providers. AI remains a focal point of regulatory inconsistency, with more than 40 jurisdictions issuing guidance or conducting supervisory exercises while applying different expectations around transparency and model governance. Firms now must manage dual risks in this area as well as risks arising from AI used in operations and from AI deployed in compliance functions. Digital assets, particularly stablecoins, are prompting varied responses worldwide. The US Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act introduces a federal framework emphasizing reserve backing and redemption rights, while Hong Kong, Japan, the EU and UK advance licensing and supervisory regimes customized for their markets. These diverging views are expected to accelerate jurisdictional regulatory arbitrage and reshape business models for digital native firms. Operational resilience has also become a supervisory priority. The EU’s DORA regime, the UK’s Critical Third Parties (CTP) framework, and Canada’s operational resilience deadlines all reflect rising concerns about the systemic risks tied to digital infrastructure. Regulators are increasing scrutiny of critical third party technology providers and intensifying scenario testing. As geopolitical uncertainty heightens vulnerability exposures, firms must build robust, technology driven controls to withstand disruptions and safeguard business continuity.Focus on consumer protection, risk governance, and NBFIsRegulators worldwide are strengthening oversight aimed at protecting consumers, enhancing governance, and monitoring emerging threats from non-bank financial institutions (NBFIs). The increasing occurrence of fraud, particularly through digital channels, has led to tougher monitoring, expanded liability expectations, and new obligations for platforms and payment service providers. The UK Financial Conduct Authority’s Consumer Duty continues to influence global standards, with Singapore, Japan, and New Zealand introducing parallel regimes emphasizing fair treatment, transparency, and enhanced complaint handling. At the same time, supervisors are devoting attention to NBFIs, whose increasing interconnectedness with the regulated banking system raises systemic concerns. The UK’s System-Wide Exploratory Scenario and France’s stress testing exercises reflect efforts to map vulnerabilities in markets where leverage or liquidity mismatches could spill over into traditional finance infrastructure.The current geopolitical situation has seen a rise of sanctions and asset freezes, and financial crime regulations are expected to continuously evolve. This gives rise to inconsistent reportorial requirements in different jurisdictions. While the EU’s Anti-Money Laundering Authority (AMLA) is expanding direct supervision and the Monetary Authority of Singapore (MAS) requires stricter reporting standards, the US Financial Crimes Enforcement Network (FinCEN) has amended its rule on beneficial ownership: foreign entities registered to do business in the US are required to report but are exempt from reporting US citizens as beneficial owners. These are just some of the differing levels of AML compliance that multinational financial institutions operating in different jurisdictions must contend with, and they should have institutional agility to comply.The road aheadThe regulatory landscape entering 2026 is unlike any in recent memory. It is no longer defined by synchronized reforms, and it is increasingly shaped by national priorities, global geopolitical tensions, and rapid technological change. For financial institutions, success will depend on how agile these institutions are in building robust compliance frameworks, strengthening risk governance, and anticipating divergent rules before they materialize.At this global crossroads, regulation is no longer merely a compliance exercise. It is now a strategic determinant of an institution’s competitiveness. Firms that understand this shift and adapt accordingly will be best placed to navigate this new global norm in financial regulation. In the next part of this Financial Regulatory Outlook series, we will be discussing local insights and how Philippine financial institutions will be affected. Ruben D. Simon Jr. is a Financial Services Consulting Senior Director of SGV & Co.This article is for general information only and is not a substitute for professional advice where the facts and circumstances warrant. The views and opinions expressed above are those of the author and do not necessarily represent the views of SGV & Co.