The Next Generation of Financial Conglomerates: BigTech and Beyond

Abstract

The structure of the EU financial sector is changing as a result of regulatory reforms and firms, including so-called BigTechs, increasingly leveraging data access, analytical capability and innovative delivery mechanisms to market and distribute new bundles of financial and non-financial services. This paper considers the implications for supervision, reflecting on the rationale for, and scope of, Directive 2002/87/EC (the financial conglomerates directive - FICOD). It concludes that an urgent review of FICOD is needed taking account of the emergence of increasingly significant mixed activity groups: the next generation of financial conglomerates.