Sector & service specialists

The EU maintains a robust regulatory framework aimed at ensuring financial stability, investor protection, and market integrity. This framework is overseen by various bodies such as the European Commission, the European Banking Authority (EBA), the European Securities and Markets Authority (ESMA), and the European Insurance and Occupational Pensions Authority (EIOPA).

Current hot topics include: the Capital Markets Union (CMU) to deepen and integrate capital markets across EU member states. Digital Finance initiatives to regulate and foster the growth of digital services like cryptocurrencies, blockchain technology, digital identity, and open banking; Sustainable Finance to promote sustainable investing, disclosure requirements for ESG factors, and the integration of climate risks into financial regulation; and Consumer Protection to combat financial fraud and misconduct, and improve access to financial services, particularly for underserved communities.

Overall, EU regulation has a profound impact on the financial services industry by aiming to ensure stability, promote innovation, enhance market integrity, and adapt to the evolving digital landscape to maintain competitiveness and safeguard the interests of stakeholders in the European financial sector.

Centralisation of power by the EU over financial services during and since the crisis in 2008 led to massive growth in the Brussels banking, insurance and financial services community. Some of the largest trade associations in Brussels represent the financial services sector including the European Banking Federation, Insurance Europe and Invest Europe.

The European Union’s Banking, Insurance, and Financial Services sector in 2025 is navigating a complex landscape marked by economic uncertainties, regulatory reforms, and technological advancements.

European banks are facing headwinds due to global trade tensions and economic uncertainties. The U.S.’s recent tariff increases have raised fears of a recession, leading to expectations of slower revenue growth and increased loan loss provisions. Moody’s has raised its baseline global default rate forecast.

Insurers are increasingly attentive to ESG-related risks and the implications of digitalization and cyber threats. The evolving dynamics in environmental agreements and the higher perceived probability of cyber risks materializing are areas of focus for risk management strategies. The EU’s Digital Operational Resilience Act (DORA) has come into force, requiring financial entities to enhance their digital operational resilience. This includes improved risk management, incident reporting, and oversight of third-party ICT service providers.