AGP Executive Report

AI in Banking Control: Canadian banks are using AI behind the scenes, but experts warn regulators and consumers may not be ready for the jump from simple chatbots to payment-initiating agents. Regulatory Watch: Australia’s APRA is launching a major review of how banks and lenders use AI, focusing on governance, risk management, and transparency for customer outcomes. Cybersecurity: A sophisticated Citrix zero-day malware campaign is targeting governments and banks, using tools tailored to compromised Citrix environments to evade detection and persist after patches. Islamic Finance Growth: QNB Capital won three IFN awards for major sukuk deals in Qatar and Kuwait, highlighting continued expansion in global Islamic finance. Banking Operations & Capital: TD plans a $10-billion share buyback after OSFI eased stability buffer requirements, freeing capital for returns and growth. Market Backdrop: US PCE inflation firmed and mortgage applications fell as rates climbed, while Europe slipped on accelerating inflation and higher oil prices. Earnings/Deals: QCR Holdings and Bank OZK set dates for Q3 results calls, while HPE shares rose on a $1.2bn Vultr AI infrastructure order. Payments & Tech: Amazon rolled out new shipping tools to cut bulky delivery costs for sellers, and Robinhood unveiled AI agents plus expanded trading features.

Tokenisation Push in Brazil: CSD BR and Ripple move from testing to live onchain recording on XRP Ledger for regulated securities, starting with BTG Pactual fund shares. Stablecoin & Payments: HSBC readies Hong Kong stablecoin “RedCoin” with payments first, while UK banks test tokenised sterling deposits in live customer trials. Regulated Crypto Market Expansion: 21X seeks US broker-dealer approval to run an ATS for trading tokenised securities. Retail Banking Pressure: Australia’s RBA rate hike lifts variable home loan rates by 0.25% from October, adding to household strain. India Payments Rules: October brings UPI MDR charges (0.4% on select P2M above ₹2,000), plus other banking and savings changes. Banking Security: RMA orders banks to tighten security controls amid rising digital fraud and OTP theft. AI in Banking: Visa says AI will reshape European retail banking by 2030, with early adopters set to pull ahead. Premium Banking Launch: Commercial Bank (Qatar) unveils the Sadara Visa Infinite card with concierge and lifestyle perks. Corporate Finance Deal: DL E&C signs financing support with 10 banks and brokerages for Seoul’s Seongsu District 2 redevelopment. New Bank Access: Apple Pay launches in India with Axis Bank cards, initially limited to eligible merchants and terminals.

Crypto & Markets: Bitcoin steadied near $84k as the 10-year Treasury yield hovered around 5.25%, while September gains look set to break a long streak; DeFi also caught a bid with Aave leading as risk appetite improves. AI Finance: Anthropic’s IPO filing flagged “catastrophic or existential” risks, while OpenAI’s business momentum pushed annual recurring revenue toward ~$70B; regulators and banks are also leaning into agentic AI for payments and compliance. Banking Tech & Payments: The Fed’s Waller urged banks to embrace DLT, tokenization, stablecoins and agentic AI for cross-border payments; BIS Project Agorá added major banks to explore tokenized deposits and central bank reserves. Regulation & Consumer Impact: Australia’s ASIC will review how banks use AI with customer protections in mind; Cyprus kept its countercyclical capital buffer at 1.5%. Corporate Banking Moves: KKR will take a majority stake in Cisternina to build India liquid storage; Gate City Bank expanded with Alkami’s digital sales and service platform. Litigation & Risk: A judge let a lawsuit accusing FirstBank Puerto Rico of facilitating Epstein’s trafficking proceed.

Central Banking: Australia’s RBA lifted the cash rate 25 bps to 4.60%, the highest since 2011, pushing up variable mortgage costs and adding pressure to household budgets. Macro & Markets: Poland’s credit outlook was hit as Moody’s downgraded its rating to A3, citing persistent fiscal deficits and rising debt even amid solid growth. Liquidity & FX: India’s RBI drained nearly US$20bn of excess rupee liquidity via dollar-rupee swaps and other tools, tightening banking-system surplus. Banking Sector Moves: Sri Lanka’s DFCC Bank was named Best Cash Management Bank for 2026, highlighting its iConnect payments and cash-management platform; CSE also approved Pan Asia Bank’s Rs 5bn debenture issue. Regulation & Compliance: US Treasury urged Lebanon to disrupt Iranian/Hezbollah financial networks and advance banking reforms. Digital Finance & Payments: Nasdaq Calypso launched agentic AI capabilities to automate parts of the trade lifecycle; Coinbase won CFTC approval for its derivatives clearing unit using USDC collateral. Retail Banking: Qatar’s Dukhan Bank rolled out a salary-transfer campaign offering new customers up to 20% cash bonuses.

Digital Wealth in Kuwait: InvestGB (Gulf Bank’s investment arm) went live with Avaloq, unifying wealth, portfolio and fund administration on one platform—its first Avaloq deployment in Kuwait. EU Third-Party Risk Rules: The EBA issued final guidelines updating how banks manage third-party risk for non-ICT services, replacing 2019 outsourcing rules. Payments Without Borders: Swift’s community is pushing a cross-border consumer payments experience by matching familiar identifiers (phone, email, virtual addresses) securely over Swift. Stablecoins Move Closer to Mainstream: Volante and Circle teamed up to let financial institutions integrate USDC workflows into existing multi-rail payments, while Cosmos is building connectivity so banks can participate in Swift’s ledger for 24/7 cross-border payments. Bank Funding & Regulation: FDIC proposed a rule to align host-state law preemption for out-of-state state banks with national banks. M&A: Valley National Bancorp agreed to buy Bluevine for $340M to boost small-business deposits and tech. AI Deposit Risk: An economist warned AI agents could quietly shift households from low-yield bank deposits to higher-yield alternatives, pressuring bank funding. Local Banking Access: NBT Bank opened an onsite student banking center with Norwich High School, expanding financial literacy through hands-on services.

Payments & Infrastructure: Kuwait’s central bank launched the Kuwait Wage Protection and Payment System (KWPS), a centralized wage-transfer platform via local banks to speed, standardize and monitor salary payments, built to ISO 20022 standards. Banking Disruption Watch: India’s UFBU deferred a planned three-day nationwide bank strike after an IBA assurance, with a high-level committee set to review the five-day workweek and remaining Saturday-holiday demands. Derivatives & Market Plumbing: HSBC adopted Nasdaq Calypso for exchange-traded derivatives clearing, aiming for integrated clearing, cross-margining and better collateral/risk visibility as tokenised assets grow. Governance & Stewardship Tech: Glass Lewis and Clarity AI combined to build an AI-enabled platform linking investment analysis, sustainability data, engagement and voting for European investors. Regulation & Risk: The UK Accelerated Settlement Taskforce rolled out a T+1 Implementation Toolkit for risk and compliance readiness. Sanctions & Financial Crime: Ukraine’s intelligence named 14 banks/intermediaries/payment systems it says help Russia evade sanctions. Deposit Rules: RBI bulk-deposit interest-rate disclosure rules start Oct 1, tightening how rates must be published and applied. Innovation Challenge: UAE banks face a new VerityX Labs push to detect and stop mule accounts earlier.

India Strike Watch: Bank unions deferred a planned three-day nationwide strike (Sept 28-30) after assurances from the Indian Banks’ Association, with a high-level IBA-UFBU committee to review remaining Saturday holidays and talks on the PLI scheme; banks are set to function normally on Monday, easing fears over salary and branch services. Kenya Banking Law: CBK and banks are in talks to overhaul the Banking Act amid a loan-rate approval standoff, as Section 44 requires Treasury Cabinet Secretary sign-off—an issue driving court uncertainty. UK Branch Cuts: Lloyds confirmed 23 branch closures in October (with more in November), citing shifting customer behavior toward mobile banking and directing everyday services to nearby Post Office/PayPoint locations. Wealth & Regulation: HSBC Private Bank’s CEO says private bankers must pair tech with human judgment to manage client anxiety in volatile markets. Switzerland M&A Signals: Reports say multiple foreign banks are interested in combining with UBS as tougher capital rules loom. Bangladesh Payments: Bangladesh Bank set timelines for resolving Bangla QR disputes, including real-time/30-minute refunds when transactions fail.

Bank Strike Watch (India): Public sector banks and regional rural banks will stay open on Sunday, Sept 27, ahead of a UFBU-called three-day strike from Sept 28–30, with RBI-approved operations for branches, ATM-linked sites and currency chests; Relief for Cash Access: several PSBs including SBI and PNB announced ATM charge waivers for the strike window to reduce customer disruption; Corporate Funding (India): Natco Pharma approved terms for a rights issue raising up to ₹1,279.35 crore, while Bajaj Housing Finance allotted ₹807.82 crore of secured NCDs via private placement; Market/Deal Updates: Prism Johnson okayed up to ₹40 crore investment in KUS Renewable for a captive wind project, and Safa Systems & Technologies received BSE in-principle approval for a preferential share allotment; Crypto/Stablecoin Risk: Tether said its exposure to EQIBank is below 0.034% after US asset seizures tied to EQIBank’s payment infrastructure.

Pre-election fiscal watch: New Zealand’s Treasury will publish its PREFU 2026 on Sept. 29, updating forecasts ahead of the Nov. 7 election, with bank economists expecting mostly incremental shifts. Crypto policy & market stance: Michael Saylor argues for five “guaranteed rights” for digital assets, while a Bitwise survey finds 15 institutions kept crypto exposure steady even after a ~50% Bitcoin drawdown. Stablecoin and exchange fallout: Bitget says it has asked THORChain to refuse service to attacker addresses after a major Bitget hack; Circle and Tether already froze related stablecoin movement. Regulators on AI accountability: The FTC’s Andrew Ferguson said developers can’t hide behind software when autonomous AI agents cause harm, signaling tougher breach-disclosure and enforcement focus. Banking sector operations: Bangladesh bankers and businesses are urging consultation before a proposed special exit facility for classified loans; in India, a Sept. 28–30 strike may disrupt cash and cheques while digital channels stay open. Central banking and gold: Central banks reported net gold purchases of about 130 tonnes through July, with reserve management and storage shifts highlighted as key considerations. Digital banking capital rules: The Philippines’ BSP set a P1 billion capital floor for thrift, rural, and cooperative banks moving toward digital-bank models. Egypt profitability: Egypt’s central bank reported H1 2026 net profits of EGP 373.133bn for banks, with the largest lenders driving most of the total.

M&A Watch: UK challenger Monzo is in talks with Brazil’s Nubank on a potential £8bn–£10bn sale, with Morgan Stanley and Qatalyst advising and a cash-and-stock structure possible. AI Governance: A NatWest survey finds 71% of customers use banking AI, but 75% want independent oversight and 81% want access to a real person. Banking Disruption: India braces for a UFBU-backed three-day nationwide strike (Sept 28-30); the government and RBI approved Sunday (Sept 27) operations and urged customers to complete key transactions early. Payments Competition: Kenya’s Kenswitch is launching a domestic card scheme to give banks a local alternative to Visa/Mastercard as card usage and POS volumes keep rising. Regulation & Risk: The Fed is working on higher asset thresholds for stricter oversight, potentially easing compliance burdens for some US banks. Crypto & Security: Bitget says a hot-wallet breach hit about $351.6m, with cold wallets unaffected and withdrawals paused. Market Pulse: NEPSE slipped 0.66% as investors rotated, while Bitcoin faces sell orders around $85,000–$85,800.

Fed & Bank Oversight: The US Fed is considering reindexing the asset thresholds that trigger tougher bank stress tests and supervision, potentially lifting the $100B and $700B triggers to about $150B and $1T to reduce costly compliance burdens and spur consolidation. Stablecoins Regulation: The Fed proposed rules under the GENIUS Act for authorized stablecoin issuers, setting supervisory standards for banks seeking permission to issue stablecoins. Stablecoin Counterparty Risk: Tether said its EQIBank exposure is under 0.034% of total assets after a US seizure tied to the offshore lender raised liquidation fears. Bank Strike Fallout (India): India’s bank unions plan a three-day strike (Sept 28–30); the Finance Ministry says the government never agreed to a five-day banking week, while nationalised banks waived ATM charges and said services will keep running. UPI MDR Consumer Protection: India’s government sources say banks will monitor merchants so UPI MDR costs aren’t passed to consumers. Crypto Market Pulse: Bitcoin held near $84K as ETF flows turned positive for 2026 after earlier deficits, while altcoins rallied. Payments & Security: Circle and Tether froze stablecoins tied to the Bitget hack, though only a small amount appeared immediately stuck. Corporate Banking News: SB Financial Group set its Q3 2026 results call for Oct 22.

SEBI Reform: India widened foreign access to physically settled non-farm commodity contracts and eased rules for portfolio managers, aiming to boost liquidity and align with global markets. Tokenization Push: Bullish and Equiniti launched an Issuer-Sponsored Token Coalition to standardize tokenized securities so onchain shares keep the same issuer-to-holder rights and corporate-action protections. UPI MDR Watch: India’s finance ministry says it will coordinate with the Indian Banks’ Association on subsidy levels and ensure merchants don’t pass UPI MDR charges to consumers as the framework takes effect from Oct 15. Banking Tech Deals: BNP Paribas and Google Cloud extended a five-year partnership to expand agentic AI and Gemini Enterprise use in corporate banking. Mortgage Momentum (Ireland): Ireland saw its strongest mortgage approvals in 15 years in August, with over €1.7bn approved and first-time buyers driving nearly 60% of activity. Digital Fraud Reality (India): A report finds 72% of victims of digital financial fraud recovered nothing, despite many reporting quickly to banks and police. DBS-Avaloq Expansion: DBS and Avaloq will expand their 18-year partnership to scale adviser capacity and support a 2030 wealth target. Market Debut: NSE’s IPO debut valued the exchange at about ₹4.5 lakh crore, closing near issue price with a modest premium.

Banking Operations & Policy: Nationalised banks are set to open on Sunday amid a three-day strike, with warnings of delays in cheque clearance and manual RTGS, while regulators and government sources say banks will monitor merchants so UPI MDR costs aren’t passed to consumers. Capital Markets & Credit: Fitch assigned a final BBB- to Bank of Maharashtra’s $500m senior notes; RBI officials pushed banks to avoid relaxing underwriting and warned on capital rules for large lenders. Digital Banking & Payments: The Fed requested public comment on a regulatory framework for Board-supervised payment stablecoin issuers under the GENIUS Act, as UK banks completed interbank transfers using tokenised deposits. Fraud & Risk: Banks warned AI shopping agents could raise scam, fraud, and data-privacy risks; a cyber fraud incident hit Apollo Finvest’s joint account, with the partner reportedly covering losses. India Corporate Finance: Varroc Engineering issued ₹50 crore 90-day commercial paper to Kotak Mahindra Bank; Inox Green Energy Services launched a QIP at a ₹174.36 floor; HDFC Mutual Fund bought 25 lakh PB Fintech shares in a bulk deal.

Embedded Finance & SME Lending: NMI expands its NMI Business Capital with new term loans and starter offers to help ISOs and SaaS platforms fund merchants faster, targeting moments like inventory buys and cash-flow shocks. Fraud-Fighting Data Tools: Equifax rolls out Signal Score for Email and Signal Score for Device to give real-time trust scoring against automated fraud and synthetic identities. Payments & Banking Tech Partnerships: Tailor teams with SoftLedger to link operational activity to accounting via an API-first, cloud-native ledger for faster close and multi-entity visibility. Tokenized Deposits Go Live (UK): Lloyds, NatWest and Barclays complete interbank mortgage transactions using tokenized deposits, while HSBC joins a peer-to-peer test under the Great British Tokenised Deposit initiative. Bank Strike Planning (India): Ahead of UFBU’s Sept 28-30 strike, India’s finance ministry orders public sector banks and RRBs to stay open on Sept 27, and unions question whether the day is fully covered—customers are urged to complete branch work early. Regulatory Pressure (Kenya): Kenya’s CBK flags a 318% jump in regulatory breaches across 35 banks, citing concentration and capital shortfalls. EU Supervision for New Tech: ESMA sets a new supervisory priority focused on AI and tokenisation oversight to protect investors while embracing innovation. Crypto Market Jitters: Bitcoin slips below $84K as Treasury yields spike, while stablecoin adoption interest rises in a Visa survey tied to bank-style protections.

Regulatory Crackdown (Kenya): The Central Bank of Kenya fined a record 33 commercial banks for loan-rate breaches after inspections found lenders didn’t cut rates in line with the benchmark, hitting 86.8% of the industry. AI & Fraud Risk (Global Banking): Major banks warned that AI shopping agents are moving faster than consumer protections, raising scam, fraud, and data-privacy concerns, while Visa found most U.S. adults still don’t understand stablecoins and trust hinges on who provides the service. Supervision for Digital Innovation (EU): ESMA set a new supervisory priority from 2027 focused on digital innovation, with early attention on AI and tokenisation use by supervised firms. Banking Operations & Disruption (India): India’s finance ministry said public sector banks and regional rural banks will stay open on Sunday, Sept. 27, ahead of a proposed three-day strike starting Sept. 28. SME Lending Overhaul (Westpac): Westpac plans to overhaul small-business banker pay and bonuses after risk-management issues drew regulator scrutiny. Capital Markets & Growth (India): SEBI chair Tuhin Kanta Pandey argued India needs banks plus stronger markets to fund infrastructure, manufacturing, energy transition, MSMEs, and tech-driven businesses. Corporate/Deal Moves: Potomac Bank will present at a virtual investor conference; RBC lifted its Standard Life view on a new PRT partnership and buyback plans; and Bangladesh Bank allowed foreign partners to use Taka Vostro accounts to settle trade in local currency.

Central Banks & Markets: Gold slipped as investors weighed the risk of higher-for-longer rates, with the Fed signaling possible further tightening while other major central banks also moved. Regulation & Capital Markets: SEBI plans a broad overhaul of merchant banking and ICDR rules, aiming to cut redundant compliance and refocus merchant banking on fundamentals beyond IPO valuations. Crypto & Derivatives: CME will add Bitcoin Cash and Uniswap futures (Oct. 19, pending review), while Russia warns stablecoin holders could face losses if issuers freeze assets outside Russian control. Tokenisation & Post-Trade: ClearToken CSD won Bank of England sandbox approval to run a Digital Securities Depository for tokenised equities and bonds, enabling 24/7 settlement and intraday repo. Banking Operations & Risk: NAB faced a major digital outage, and Belarus card processing may see short disruptions; banks also issued fresh warnings about AI shopping bots increasing scam and fraud risks. Liquidity & Rates: RBI absorbed ₹71,971 crore via overnight VRRR as surplus liquidity stayed high; Nigeria’s CBN cut the MPR by 350 bps to 23%, with pressure on banks to pass through lower lending rates. Payments & Banking Tech: iFAST Global Bank launched “Get Paid” for faster SME payment collection via links, QR codes and invoices; NPCI rolled out MyUPI on BHIM for conversational UPI support.