Top of mind issues for capital markets and wealth management

SEC exemptive relief on fully paid securities borrowing (Rule 15c3-3) marks a meaningful modernization of the securities lending framework. In March 2026, the SEC's Division of Trading and Markets issued an exemptive order permitting broker-dealers to pledge diversified baskets of highly liquid Russell 1000 and S&P 500 equity securities as collateral when borrowing fully paid or excess margin securities from qualified institutional lenders. The relief expands permissible collateral beyond cash and Treasuries while preserving full collateralization and daily mark-to-market requirements. Firms should assess the applicability of this relief to their lending arrangements, update collateral management frameworks, and strengthen governance and compliance monitoring to reflect the new conditions.

SEC staff statement on broker-dealer registration for crypto asset user interfaces provides long-awaited interim clarity for the digital asset ecosystem. The April 2026 statement introduces the concept of "Covered User Interfaces" — software applications that facilitate user-directed transactions through self-custodial wallets — and clarifies that, under defined conditions, such providers may not be required to register as a broker-dealers. The boundary between permissible interface activity and conduct that triggers registration requirements is precise, and firms operating in this space should assess their platforms, evaluate business models against the SEC's risk indicators, and monitor for future rulemaking given the statement's temporary, five-year duration.

From AI enablement to AI as infrastructure defines the central competitive dynamic in wealth management today. AI has evolved from isolated automation into embedded infrastructure spanning client acquisition, onboarding, advice preparation, portfolio monitoring, and service delivery. Adoption is no longer optional — it is central to sustaining margins and expanding reach amid fee compression and advisor capacity constraints. Leading firms in 2026 are differentiating not by whether they use AI, but by how effectively they embed it into their end-to-end operating model, redesigning roles and workflows to shift human effort toward relationship management and revenue-generating activities.

Form PF updates continue to add compliance considerations for investment advisers to private funds, reinforcing the importance of robust data governance, reporting infrastructure, and proactive monitoring of evolving requirements across the regulatory landscape.

From approval to execution: Operationalizing dual-share class ETFs captures a critical inflection point in product strategy. More than 50 approvals have been granted, but only a handful of firms have successfully launched products — making it clear that regulatory approval is no longer the obstacle; execution is. Legacy system friction, suitability obligations under Reg BI and ERISA, and cannibalization risk across existing fund lineups all require careful sequencing, infrastructure investment, and advisor training before broader adoption can take hold.