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Margin compression, market volatility, rising regulatory demands, and growing competition from non-bank lenders are all testing banks’ ability to grow without compromising stability. 

To understand how institutions are navigating this complex landscape, we spoke with 32 senior professionals across lending, risk, and finance at leading global banks. These conversations revealed a clear shift: risk is no longer just about oversight – it's becoming a proactive, strategic partner to the business. We also uncovered key challenges and strategies shaping how banks manage risk while remaining agile, relevant, and profitable.

Here are nine of the most pressing themes shaping banking strategy today. The first five you can find in Part 1.

6. Fragmentation between risk, finance, and origination persists 

Despite progress, many banks still face disconnects between their risk, finance, and origination teams. These silos lead to slower credit approvals, missed early warning signals, and inconsistent portfolio decisions. To fix this, some institutions are forming integrated “deal teams” or embedding risk professionals into frontline units. Others are investing in shared data platforms and dashboards for a clearer, unified view of risk and performance. As one Senior Banker put it, “Everyone is looking at different dashboards, in different formats, at different times.” By breaking down these barriers, banks can improve collaboration, speed up decision-making, and steer portfolios with greater precision. 

7. Risk monitoring is improving – but early warning is still weak 

While risk monitoring tools have improved, many banks admit they still struggle with spotting problems early. Most systems remain backwards-looking, with limited visibility into borrower deterioration between reporting cycles. Some banks are building dashboards or piloting tools that track borrower performance against covenant triggers, incorporate macroeconomic stress overlays, or surface market sentiment and peer signals. Yet, few have achieved a system that moves decisively from “what happened” to “what might happen.” One Lending Originator in APAC noted, “If your client is deteriorating at the start of the quarter, you won’t know until the financials come in.” Institutions know that more predictive, real-time monitoring – ideally powered by AI – will be critical for managing emerging risks with greater speed and precision. 

8. Risk culture is evolving from policing to partnership

Risk is no longer just the final checkpoint. Increasingly, it’s involved early on, shaping decisions, aligning with risk appetite, and partnering with the front line. This shift means business teams are expected to own risk more proactively, while finance and senior leadership help guide portfolio-level decisions and adjust appetite as needed. A US Chief Credit Officer told us, “Risk isn’t about slowing things down. It’s about getting to the right decisions faster, with more clarity.” Ultimately, the goal is to make risk management a natural, embedded part of business planning – not a last-minute hurdle. 

9. Data, technology and AI: There is a gap between potential and reality 

There’s strong interest in using artificial intelligence (AI) and advanced data analytics to modernise risk – but the gap between potential and reality remains significant. Legacy systems, fragmented data, and limited trust in AI still limit widespread adoption. Most banks are using AI for things like document generation, fraud detection, and onboarding support. More advanced uses – like AI-driven credit decision–making or predictive portfolio optimisation – are still in pilot phases. A Head of Wholesale Credit Risk in Europe commented, “The data’s there – but it’s not clean, it’s not standardised, and it’s not talking to each other.” Still, banks see AI as an accelerator, not a replacement – a way to augment human expertise and streamline processes when used wisely. 

Banks today are navigating one of the most complex operating environments. They’re responding not by retreating from risk, but by managing it more proactively, collaboratively, and strategically. From rethinking portfolio diversification to embedding risk into everyday decision-making, the most forward-looking banks are bridging internal silos, modernising their toolkits, and adapting their cultures to stay competitive and resilient.

The road ahead will demand even greater alignment between lending, risk, finance, and technology, and those that succeed will be the ones that treat risk not as a constraint, but as a catalyst for smarter, more sustainable growth.