FCA Wholesale Markets Regulatory Priorities 2026: Compliance Guide for All Wholesale Firms

The Financial Conduct Authority (FCA) has published its 2026 Regulatory Priorities for Wholesale Markets, outlining the regulator’s supervisory focus for firms operating across UK wholesale financial markets. This includes wholesale banks, brokers, trading venues, benchmark administrators, corporate finance firms, credit rating agencies and market infrastructure providers.

The report forms part of the FCA’s new approach to communicating supervisory expectations. These annual regulatory priority reports replace the previous portfolio letters and provide firms with a clearer overview of the regulator’s strategic objectives and supervisory focus.

For firms operating in wholesale markets, the document highlights the importance of maintaining a strong compliance framework, governance arrangements and risk management controls. Many firms are therefore reviewing their regulatory compliance framework, compliance monitoring plan and compliance risk assessment processes to ensure alignment with the FCA’s evolving supervisory approach.

The Role of Wholesale Markets in the UK Financial System

Wholesale markets play a vital role in the UK economy by enabling businesses, investors and governments to raise capital and manage financial risk. The FCA emphasises that the UK continues to be a leading global financial centre, supported by deep expertise, international participation and a strong regulatory framework.

The UK hosts some of the largest global financial markets, including those for:

• International bond issuance

• Foreign exchange trading

• Over-the-counter interest rate derivatives

These markets depend on strong governance, transparency and effective regulatory oversight. Maintaining high standards of compliance in investments, conduct risk management and operational resilience is therefore critical to maintaining market confidence.

Against this backdrop, the FCA has identified five core supervisory priorities for wholesale markets in 2026.

Key Priority One: Improving the Resilience of Firms and Markets

Operational and financial resilience remain central regulatory themes. Recent global market volatility and operational disruptions have demonstrated how quickly issues at individual firms can spread across markets.

The FCA therefore expects firms to strengthen their resilience frameworks by embedding operational resilience into governance structures and day-to-day operations. Firms should ensure that critical services can continue during disruption and that appropriate incident response and recovery planning is in place.

Key areas firms should focus on include:

• Strengthening operational resilience frameworks and scenario testing

• Improving oversight of third-party service providers and technology dependencies

• Ensuring trading controls remain robust during market volatility

• Maintaining adequate liquidity management and financial resilience frameworks

From a compliance perspective, this often involves reviewing internal compliance monitoring frameworks, corporate compliance risk assessments and operational risk management arrangements. Many firms also undertake periodic regulatory health checks or compliance gap analysis to ensure resilience frameworks remain effective.

Key Priority Two: Enhancing Efficient and Competitive Markets

Another key priority for the FCA is improving the efficiency and competitiveness of UK wholesale markets. The regulator is continuing a multi-year programme of regulatory reform designed to strengthen market transparency, support capital raising and encourage innovation.

Recent reforms include changes to the UK prospectus regime, simplified listing requirements and improvements to post-trade transparency through consolidated market data tapes. The FCA is also supporting the transition to T+1 settlement cycles and the dematerialisation of shareholding structures.

These reforms are designed to:

• Improve market transparency and price discovery

• Reduce barriers to capital raising

• Increase market liquidity and competitiveness

• Support innovation in financial markets

Firms should ensure that their compliance monitoring plans and compliance annual plans capture these regulatory developments and that internal governance processes adapt to the evolving market structure.

Key Priority Three: Supporting the Safe Adoption of New Technology

Technological innovation continues to reshape wholesale financial markets. Technologies such as artificial intelligence, distributed ledger technology and digital assets are increasingly influencing trading activity, market infrastructure and investment decision-making.

The FCA recognises the potential benefits of these technologies but emphasises that firms must implement robust governance and risk management when adopting them. Firms are expected to ensure that new technologies are properly tested and that their associated risks are clearly understood.

In particular, firms should ensure that:

• Governance frameworks clearly oversee the use of emerging technologies

• Risks associated with AI models and automated trading systems are monitored

• Third-party technology providers are subject to appropriate due diligence

• Data security and operational resilience risks are addressed

The FCA continues to support innovation through initiatives such as the FCA regulatory sandbox and FCA digital sandbox, which allow firms to test new financial technologies within a controlled regulatory environment.

Key Priority Four: Preventing Financial Crime and Market Abuse

Preventing financial crime and market abuse remains one of the FCA’s core supervisory priorities. The regulator expects firms to maintain robust systems and controls capable of identifying suspicious trading activity, insider dealing and money laundering risks.

However, the FCA has identified weaknesses in some firms’ financial crime frameworks. In particular, the regulator has noted issues such as weak business-wide risk assessments (BWRA), over-reliance on third-party due diligence and gaps in market surveillance systems.

Firms should therefore review their financial crime controls to ensure that:

• Business-wide risk assessments are robust and regularly updated

• Transaction reporting data is accurate and complete

• Market abuse surveillance systems are properly calibrated

• Governance oversight of financial crime controls is effective

Key Priority Five: Managing Conflicts of Interest and Conduct Risk

The FCA also emphasises the importance of effective conflict-of-interest management and strong conduct oversight. Even in wholesale markets, where participants are often sophisticated counterparties, poorly managed conflicts can lead to poor client outcomes and reduced market confidence.

The regulator has identified instances where conflicts were not adequately disclosed or managed, particularly in areas such as securities issuance, benchmark administration and credit rating activities.

Firms should therefore ensure their governance frameworks enable conflicts to be identified and managed effectively. This includes ensuring that remuneration structures, product design and business incentives do not create conduct risks that undermine fair market outcomes.

Additional Areas of Regulatory Focus

Alongside its core priorities, the FCA will continue progressing several additional regulatory initiatives that may affect wholesale market participants. These include ongoing work on the Investment Firms Prudential Regime (IFPR), reforms to the UK securitisation framework and the development of a regulatory regime for ESG ratings providers.

The regulator will also review the Senior Managers and Certification Regime (SMCR) to assess whether it can be simplified while maintaining effective accountability.

These initiatives further highlight the importance of maintaining a strong regulatory compliance framework and ongoing compliance support arrangements.

What All Wholesale Firms Should Do Now

The FCA’s regulatory priorities reinforce the importance of maintaining strong governance, risk management and compliance oversight across wholesale financial markets.

Senior management teams should review whether their existing compliance frameworks adequately address the FCA’s expectations. In practice, this may involve reviewing:

• The firm’s compliance monitoring plan and compliance monitoring framework

• The firm’s business-wide risk assessment

• Financial crime controls and market abuse surveillance arrangements

• Operational resilience frameworks and third-party risk management

• Conflicts of interest governance and conduct oversight

Many firms engage FCA compliance consultants to help assess these frameworks and ensure that regulatory expectations are fully understood and implemented.

How Compliance Angle Can Help

The FCA’s 2026 regulatory priorities reflect a regulatory environment that is evolving alongside significant changes in financial markets. Innovation, technological development and the growth of private markets are creating new opportunities for firms, but also introducing new risks.

For firms operating in wholesale markets, the message from the regulator is clear: firms must continue to strengthen governance, risk management and investor protection while adapting to these structural changes.

At Compliance Angle, we support wholesale markets firms with:

• FCA authorisation support and FCA application support

• Development of compliance monitoring frameworks and compliance monitoring plans

• Business-wide risk assessments

• Compliance gap analysis and regulatory health checks

• Ongoing compliance advisory and outsourced compliance support

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Our goal is to help firms maintain a robust FCA compliance framework that supports both regulatory compliance and sustainable business growth.