DLA Piper Financial Futures Report – A New Zealand Lense

In the latest edition of DLA Piper’s Financial futures: Leading through disruption report, the financial services sector remains confident despite being increasingly tested. Based on a global survey of nearly 800 senior financial services leaders, the report shows a clear shift from strategy setting to execution, as firms contend with geopolitical uncertainty, rapid digitalisation and rising regulatory expectations.

For the New Zealand financial services sector, the report offers a useful global lens. While local market dynamics differ from larger financial centres, many of the challenges identified globally are familiar to our experiences in New Zealand. The report’s core themes – governance, resilience and sustained compliance – align closely with issues shaping the New Zealand financial services landscape.

 

Continued growth and confidence amid uncertainty

Globally, 83% of survey respondents report being optimistic about the outlook for the financial services sector over the next one to two years. Asia Pacific is identified as having the most favourable growth conditions, reflecting perceptions of greater stability and predictability relative to other regions. That is favourable for New Zealand and its outlook.

We are seeing increasing interest from offshore investors in the Australasian market, seeking opportunities to deploy capital into stable regions.

With a local lens, as at September 2025, the Financial Markets Authority (FMA) reported KiwiSaver funds under management had reached NZD123 billion, up 10% year-on-year, reinforcing continued growth in the sector domestically.

 

AI adoption and governance impact

A clear report theme is that AI has moved from ambition to implementation. Respondents reported measurable AI impact over the previous 12 months, with use cases concentrated on operational efficiency, fraud detection and transaction monitoring, data management and customer service.

The practical implication is that the “hard part” is increasingly governance. The report suggests the principal constraints on AI are no longer whether to adopt the technology, but how to do so safely and at scale – including data privacy and security, legacy system integration, model risk management, cost and skills.

Unlike some other jurisdictions covered in the report, New Zealand does not have AI-specific regulation, instead opting for a light-touch approach leveraging existing laws, anchored in the Privacy Act 2020, as well as intellectual property, human rights and employment laws. However, the themes from the report are highly relevant for New Zealand financial services firms, given our financial services regulatory framework, which requires robust governance, as well as increasing regulatory scrutiny from the likes of the FMA and the Reserve Bank of New Zealand on operational resilience, cybersecurity and customer outcomes.

 

Cyber risk and financial crime

The report also shows how closely cybersecurity, data protection and financial crime risks are converging with operational resilience and customer trust. In the survey, 62% of respondents identify cybersecurity and data protection risk as a leading business challenge, and the same proportion cite financial crime risk.

New Zealand is experiencing the same pressures. Based on the most recent report from the National Cyber Security Centre (NCSC), in the fourth quarter of 2025 there were 1,131 incident reports with a direct financial loss of NZD3.2 million for that quarter, down from the previous quarter’s direct financial loss of NZD12.4 million (which is considered unusually high).

The NCSC also issued a public alert in March 2026 urging organisations to increase vigilance in response to malicious cyber activity linked to events in Iran – a reminder for boards that geopolitical tension can translate quickly into operational risk.

The report’s broader insight is that cyber, fraud and financial crime are no longer isolated specialist topics. They increasingly sit inside the core operating model, with direct implications for governance, controls, customer experience and reputation.

This direction aligns with the Government’s Transnational, Serious and Organised Crime Strategy 2026–2030, which signals increased expectations around earlier detection of organised criminal activity and stronger private sector engagement in disrupting criminal proceeds, including through financial systems.

Recent FMA work also reflects that same focus. In February 2026, the FMA published operational resilience findings for the peer-to-peer lending sector, highlighting the importance of incident identification, escalation and tested response processes.

 

Regulation is shifting from “new rules” to continuous compliance

One of the clearest shifts identified in the report is that managing ongoing compliance with the regulatory landscape is having the greatest impact on businesses in the financial services sector. There has been a shift from discrete reform and implementation projects to continuous operational discipline.

That observation reflects the New Zealand sentiment as well. In recent years, conduct, disclosure and governance expectations have increased across the sector. The Conduct of Financial Institutions (CoFI) regime introduced by the Financial Markets (Conduct of Institutions) Amendment Act 2022 came fully into effect on 31 March 2025, with the fair conduct principle now at the forefront of day-to-day decision-making for firms.

The FMA’s subsequent thematic work on product and service reviews in December 2025 signalled that its mandate as a conduct regulator will increasingly focus on whether existing offerings remain fit for purpose over time.

More broadly, New Zealand firms are dealing with the cumulative effect of increasing regulation across the full range of their activities – including conduct, resilience, cyber, financial crime and climate. The regulatory test is now whether governance, data and controls operate coherently across those obligations over time and not whether individual rules are technically complied with.