The Office of the Comptroller of the Currency (OCC) announced today that it has conditionally approved the merger of Discover Bank, Greenwood, Delaware, into Capital One, National Association, McLean, Virginia. The OCC conducted a fulsome review of the application submitted March 21, 2024, to ensure all statutory and regulatory requirements have been met. The approval also follows consideration of numerous public comments submitted in writing and expressed during a public meeting held with the Board of Governors of the Federal Reserve System conducted on July 19, 2024. Today’s announcement reflects the OCC’s careful analysis of the effect of the merger on communities, the banking industry, and the U.S. financial system. The OCC’s approval of Capital One’s application is conditioned upon the approved plans detailing effective and sustainable corrective actions and timelines to address the root causes of any outstanding enforcement actions against Discover Bank and remediation of harm. “The OCC is committed to a regulatory framework that expands access to financial services for consumers, businesses and communities,” said Acting Comptroller of the Currency Rodney E. Hood. Upon consummation of this transaction, Capital One, National Association is expected to have $660 billion in total assets. Related Link Conditional Approval Letter for Capital One, National Association to Acquire Discover Bank (PDF)

The Federal Reserve Board on Friday announced its approval of the application by Capital One Financial Corporation, of McLean, Virginia, to merge with Discover Financial Services, of Riverwoods, Illinois, and thereby indirectly acquire Discover Bank, of Greenwood, Delaware. The Board evaluated the application under the statutory factors it is required to consider, including the financial and managerial resources of the companies, the convenience and needs of the communities to be served by the combined organization, and the competitive and financial stability impacts of the proposal. The Board also entered into a consent order with Discover and assessed a fine of $100 million for overcharging certain interchange fees from 2007 through 2023. Discover has since terminated these practices and is repaying those fees to affected customers. The Board's action is being taken in coordination with the Federal Deposit Insurance Corporation. As a condition of the Board's approval of the merger application, Capital One has committed that it will comply with the Board's action against Discover, including remediation requirements. Order (PDF) Consent Order (PDF)

WHAT: Commissioner Kristin N. Johnson will deliver keynote remarks at the Africa Fintech Summit Washington DC 2025. WHEN: Thursday, April 24, 20259:45 a.m. (EDT) WHERE: Halcyon Centre3400 Prospect Street, NWWashington, DC 20007Additional Information: Africa Fintech Summit Washington

(Excerpt) (Tuesday, April 8, 2025, 9:12 am to 9:18 am) [Opening remarks:] Minister) Today, the government held a meeting of the Comprehensive Response Headquarters for U.S. Tariff Measures, and Prime Minister Ishiba gave instructions to thoroughly examine the content of the U.S. tariff measures and fully analyze their impact on Japan, to take diplomatic measures such as strongly urging the U.S. to review its measures, and to ensure that all necessary support is provided, including financial support.In response to the Prime Minister’s instructions, the government decided to establish the Ministry of Finance (MOF) Comprehensive Response Headquarters for U.S. Tariff Measures in the ministry, with the Vice-Minister of Finance as the chief of the Headquarters, and the Financial Services Agency (FSA) Comprehensive Response Headquarters for U.S. Tariff Measures in the agency, with the Commissioner of the Financial Services Agency as the chief of the Headquarters.We will examine the necessary measures at the Headquarters of the MOF and the FSA, and in cooperation with the relevant ministries, and ensure that we are fully prepared to respond to the current U.S. tariff measures. [Questions and answers:] Q. There has been talk of establishing a Comprehensive Response Headquarters at the MOF and the FSA, respectively, but what exactly will be discussed? A. First of all, we will each carry out an analysis of the measures taken this time and do that thoroughly.The Ministry of Finance has government-affiliated organizations, etc., so we will collect requests from those organizations and ensure that we have the necessary support measures in place. Also, at the Financial Services Agency, I think there are various consultations at each financial institution. We will collect information on such matters and ensure that appropriate measures are taken at each financial institution.We will give instructions on such matters and ensure that everything is in place. Q. There was a mention of financial support. Currently, regional banks are already working on individual financing support for local small and medium-sized businesses, such as setting up special loan frameworks, so I would like to know whether the FSA as a whole is considering the option of moving towards financial support, such as the effectively interest-free and unsecurerd loans during past crises or large-scale financial facilitation measures, and whether you are currently considering them. A. We are asking that each institution provides thorough financial support and that such support is dealt with within the existing framework, but we are not considering anything specifically beyond that at present. The Prime Minister said that, in general, it is quite possible that various effects will become more apparent from now on, so first of all we would like to make a concerted effort to analyze and understand the information. And we will take the necessary measures as needed, which I think is a matter of course.

(Excerpt) (Monday, April 7, 2025, 12:44 pm to 12:48 pm) [Opening remarks:] Minister) First of all, with regard to the tariff measures taken by the United States, we will strongly request that the United States exclude Japan from the scope of the measures. As stated by the Prime Minister, we will make every possible effort to implement necessary measures, such as financing measures, in consideration of the impact on domestic industries and employment, and we are responding in cooperation and coordination with relevant ministers.With regard to the financial and capital markets, unstable movements have been observed worldwide, and the circuit breaker for the Nikkei 225 Futures and other issues was activated this morning. We believe it is important for investors to make calm judgments. In addition, we believe that it is important for individual investors to make investment decisions while taking into account the importance of long-term, cumulative, and diversified investments for stable asset building. We will also ask financial institutions to carefully respond to consultations from investors based on this approach.We are also gathering information and consulting with national authorities through a variety of bilateral and multilateral channels and will continue to pursue these responses. Yesterday, the Prime Minister instructed us to continue monitoring market trends and the status of transactions with a high level of alertness and take appropriate measures in cooperation with relevant ministries and agencies. We will follow the instructions from the Prime Minister. That’s all from me. [Questions and answers:] Q. What is your view of the global stock market plunge triggered by Trump’s tariffs? Also, what is your view of the situation in which the stock market plunge has not stopped in Japan? Please give us your opinion. A. As I mentioned earlier, I recognize that the global financial and capital markets, the U.S. tariffs, and various developments related to them continue to cause instability. I would like to refrain from commenting on the daily level itself. As I said earlier, I would like relevant parties to address these trends individually. We will continue to closely monitor these trends and take appropriate measures. Q. Will volatility in financial markets affect the normalization of financial policy that has been pursued so far? If normalization ceases, there is a possibility that the yen will weaken and prices will surge. Please give us your opinion as the Minister. A. As it is a specific financial policy, the Bank of Japan is expected to respond one way or another, as it has in the past.In addition, as I mentioned earlier, we will continue to work closely with the relevant ministries and agencies to respond in any case. Q. I would like to ask you a question again. Owing to the instability in the stock market, for example, people who started investing in stocks under the new NISA (Nippon Individual Savings Account) have suffered losses, and unrest is spreading among investors. As the Minister of Finance, please tell us how you perceive this situation and how you address those people. A. As I said earlier, individual investors in particular should focus on long-term, cumulative, and diversified investments for stable asset building. I would like them to take that into consideration when making investment decisions.Also, I believe that financial institutions receive various inquiries and consultations from investors, so I would like them to respond carefully with this approach. I will request financial institutions to do this as well.

Please click for the announcement.

The Federal Reserve Board on Thursday requested comment on a proposal to reduce the volatility of the capital requirements stemming from the Board's annual stress test results. The proposal is the first of several actions following the Board's announcement in December committing to broad stress test changes. In recent years, the framework of administrative law has changed significantly. As previously announced, the Board analyzed the current stress test in view of those changes and determined the test should be modified in important respects to improve its resiliency. The Board's stress test evaluates the resilience of large banks by estimating their losses, revenue, and capital levels under a hypothetical severe recession scenario. Due to the changing hypothetical nature of the test, the results also change and introduce volatility each year. The results, in part, determine the calibration of the stress capital buffer (SCB), which is one component of the amount of capital large banks must hold to absorb losses. Today's proposal would address two of these areas, first by averaging stress test results over two consecutive years to reduce the year-over-year changes in the capital requirements that result from the stress test. In addition, the proposal would delay the annual effective date of the stress capital buffer requirement from October 1 to January 1 of the following year, giving banks additional time to adjust to their new capital requirements. Lastly, the proposal would make targeted changes to streamline the Board's stress test-related data collection. These proposed changes are not designed to materially affect overall capital requirements. Later this year, the Board intends to propose additional changes to improve the transparency of the stress test. Those changes include disclosing and seeking public comment on the models that determine the hypothetical losses and revenue of banks under stress, and ensuring that the public can comment on the hypothetical scenarios used for the annual stress test before the scenarios are finalized. Comments on today's proposal are due 60 days after publication in the Federal Register. Board memo: Proposed rule to reduce the volatility of the stress capital buffer requirement (PDF) Federal Register notice: Modifications to the Capital Plan Rule and Stress Capital Buffer Requirement (PDF) Statement by Governor Michael S. Barr Statement by Governor Adriana D. Kugler

The Commodity Futures Trading Commission’s Market Participants Division, the Division of Clearing and Risk, and the Division of Market Oversight (Operating Divisions) and the Division of Enforcement (DOE) today issued a staff advisory providing guidance on the materiality or other criteria that the Operating Divisions will use to determine whether to make a referral to DOE for self-reported violations, or supervision or non-compliance issues.  This advisory furthers the implementation of DOE’s recent advisory, issued February 25, 2025, addressing its updated policy on self-reporting, cooperation, and remediation. [See CFTC Press Release No. 9054-25.] RELATED LINKS CFTC Staff Letter 25-13

WHAT: Acting Chairman Caroline D. Pham will discuss new policies and priorities at a Bloomberg roundtable. WHEN: Thursday, April 24, 20251:00 p.m. (EDT) WHERE: Bloomberg Washington DC Office1101 New York Avenue, NWWashington, DC 20005

The Exchange's markets are closed today, April 18, 2025.

WHAT: Acting Chairman Caroline D. Pham will participate on a panel, Balancing Local and Global Priorities in Policymaking (II), at IIF Future of Global Financial Policymaking Roundtable. WHEN: Thursday, April 24, 202510:20 a.m. – 11:00 a.m. (EDT) WHERE: Institute of International Finance1333 H Street NW, Suite 1010EWashington, DC 20005Additional information: The Institute of International Finance | Events

The Office of the Comptroller of the Currency (OCC) today released enforcement actions taken against individuals currently and formerly affiliated with banks the OCC supervises. The OCC uses enforcement actions against an institution-affiliated party (IAP) to deter, encourage correction of, or prevent violations, unsafe or unsound practices, or breaches of fiduciary duty. Enforcement actions against IAPs reinforce the accountability of individuals for their conduct regarding the affairs of a bank. The term “institution-affiliated party,” or IAP, is defined in 12 USC 1813(u) and includes bank directors, officers, employees, and controlling shareholders. Orders of Prohibition prohibit an individual from any participation in the affairs of a bank or other institution as defined in 12 USC 1818(e)(7). Actions taken against IAPs are: Order of Prohibition against Alhassan Abubakar, former Associate Banker at a New York, New York, branch of JPMorgan Chase Bank, National Association, Columbus, Ohio, for misappropriating $20,000 from the bank. (Docket No. AA-ENF-2025-08) Order of Prohibition against Jacqueline Molina, former Customer Service Representative at TD Bank, N.A., Wilmington, Delaware, for fraudulently obtaining over $40,000 in Paycheck Protection Program funds under the Coronavirus Aid, Relief, and Economic Security Act. (Docket No. AA-ENF-2025-11) Order of Prohibition against Nick Zatikian, former Associate Banker at a Tujunga, California, branch of JPMorgan Chase Bank, National Association, Columbus, Ohio, for embezzling at least $34,900 from the bank and altering the bank's internal records to conceal his embezzlement. (Docket No. AA-ENF-2025-03) To receive alerts for news releases announcing public OCC enforcement actions, subscribe to OCC Email Updates. All OCC public enforcement actions taken since August 1989 are available for download by viewing the searchable enforcement actions database at https://apps.occ.gov/EASearch. Related Links Enforcement Action Types

The US Treasury market is the world’s biggest and most systemically important market. It’s the oil that keeps the wheels of the global financial system turning and is the primary means by which the US government raises funding. It’s therefore right that US policymakers focus on ensuring this market remains robust and resilient, and they’ve determined that mandatory clearing of US Treasury securities is part of the answer. We support clearing, but such a massive structural change to the US Treasury market can’t be introduced in isolation – several other important regulatory reforms will be fundamental to its success. Last week, I had the opportunity to highlight the changes necessary in testimony to the US House of Representatives Committee on Financial Services. I drew attention to four key reforms that are required to ensure clearing is successful and the US Treasury market remains deep and liquid. Crucially, these issues must be resolved before the clearing mandates come into force, on December 31, 2026 for cash Treasury securities and June 30, 2027 for repos. First, the supplementary leverage ratio (SLR) should be modified to ensure banks have the balance sheet capacity to provide intermediation and client clearing services in the US Treasury market, including during periods of stress. At the height of the global pandemic in April 2020, concerns about bank intermediation capacity prompted the Federal Reserve to temporarily exclude US Treasuries from the SLR calculation. That’s because the SLR serves as a non-risk-sensitive constraint on banks that can impede their ability to act as intermediaries, particularly in times of stress. Last year, I sent a letter to US banking agencies requesting that this exemption be reintroduced on a permanent basis. The SLR is not part of the Basel III endgame package, so we would urge a separate consultation. We were pleased to hear Federal Reserve chair Jerome Powell recently acknowledge that changes are necessary, as well as comments by Treasury secretary Scott Bessent and Federal Reserve governor Michelle Bowman drawing attention to this issue. Second, efficient clearing of US Treasuries by clients requires that the amount of margin posted and corresponding bank capital requirements reflect the actual risk of client exposures across their entire portfolios. To achieve this, margin offsets across US Treasury securities and futures transactions need to be extended to client positions, as they currently are for clearing members. The offsetting risks then need to be recognized when banks determine their exposure to clients under the US capital framework. Without this recognition, bank capital requirements will overstate the risk in a client’s portfolio. Third, changes are necessary to the Basel III endgame proposal and the surcharge for global systemically important banks (G-SIBs). It has long been clear that these measures, as currently proposed, are inappropriately calibrated. Nowhere is this more evident than in clearing. Analysis has shown that the proposed US Basel III rules and the G-SIB surcharge would increase capital for US G-SIB client clearing businesses by more than 80%. This punitive tax is completely at odds with the policy objective to promote greater use of central clearing. It is not aligned with risk and would bring the economic viability of client clearing businesses into question at precisely the wrong time. Finally, it is critical that the market can implement the clearing mandate in a safe and efficient manner. Good progress is being made in many areas. ISDA, for example, has published analyses of various clearing models, conducted multiple educational seminars and conferences and is collaborating with others – including the Securities Industry and Financial Markets Association – to develop appropriate client documentation. But clearing models and clearinghouse offerings are still under development and will require regulatory approvals and testing once they are finalized. Then, thousands of counterparties around the world will need to agree to them. We welcome a recent one-year implementation delay agreed by the Securities and Exchange Commission, but we need to continue to monitor timelines to ensure there is sufficient time to complete the necessary preparations and reforms in a way that protects the integrity of this vital market. US Treasuries play a pivotal role in the derivatives and financial markets, so we need to make sure that capital rules support Treasury market liquidity, appropriately reflect risk and facilitate Treasury clearing. To ensure the effective implementation of the clearing mandate, as opposed to deterring additional clearing, we urge US banking agencies to address the necessary corrections. The smooth functioning of the US Treasury market depends on it.  

Notice Type: Exchange Notice ID: 1831.041725 2025 Pursuant to Section 5c(c)(1) of the Commodity Exchange Act, as amended (“Act”), and Section 40.6(d) of the regulations promulgated by the Commodity Futures Trading Commission (the “Commission”) under the Act (the “Regulations”), North American Derivatives Exchange, Inc. (“Nadex”, the “Exchange”) hereby provides notice that due to increased or decreased volatility, as the case may be, in the underlying markets upon which the Nadex contracts are based, Nadex made changes to the strike widths of various contracts during the week of April 14, 2025 as indicated in the Weekly Notice. Should you have any questions or require further information, please contact the Compliance Department. Should you have any questions or require further information, please contact the Compliance Department. Notice 1830 Weekly Notification

A panel of the Capital Markets Tribunal today approved the Ontario Securities Commission’s (OSC) settlement agreement with Blockratize Inc. and Adventure One QSS Inc. for their failure to comply with the ban on offering short-term binary options to individual investors in Ontario. Between June 2020 and May 2023, Blockratize Inc. and later Adventure One QSS Inc. violated Ontario securities law by offering binary options to investors in Ontario through their online global options trading platform Polymarket in breach of Multilateral Instrument 91-102 Prohibition of Binary Options (the Binary Options Ban). The Binary Options Ban prohibits the advertising, offering, selling or trading of options to individual investors in Ontario that contain a yes/no proposition regarding the future outcome of a price or event, have a term to maturity of less than 30 days and offer a fixed payout if the proposition is met or nothing if it is not. Blockratize Inc. and Adventure One QSS Inc. will be subject to two-year market bans, including a ban from trading securities or derivatives. Additionally, they have agreed to an administrative penalty of $200,000, a $22,966.75 USD voluntary payment, and a further $25,000 towards the cost of the OSC’s investigation. A copy of the Settlement Agreement is available on the website of the Capital Markets Tribunal. The mandate of the OSC is to provide protection to investors from unfair, improper or fraudulent practices, to foster fair, efficient and competitive capital markets, and confidence in the capital markets, to foster capital formation, and to contribute to the stability of the financial system and the reduction of systemic risk. Investors are urged to check the registration of any persons or company offering an investment opportunity and to review the OSC investor materials available at https://www.osc.ca.

The Canadian Securities Administrators (CSA) recognizes the current uncertainty in global markets, and the impact this is having on companies and investors’ decisions to participate in Canadian capital markets. In response, the CSA is introducing measures to support market participants that choose to go public, maintain a listing, and contribute to capital formation in Canada. “Canada is a great place to do business, and companies going public here support investors and the vitality of our capital markets,” said Stan Magidson, CSA Chair and Chair of the Alberta Securities Commission. “The actions announced today represent the start of incremental measures to support the competitiveness of Canada’s capital markets. We are making it easier and more cost-effective for businesses to raise capital and grow in Canada, without sacrificing investor protection.”  A multi-faceted prospectus and disclosure blanket order will reduce regulatory burden and provide greater flexibility for companies that are currently reporting, or that choose to pursue an initial public offering (IPO) in Canada. In response to stakeholder feedback, the blanket order expands to all companies, the existing exemption from the requirement to provide audited financial statements for the third most recently completed financial year in connection with IPOs and other transactions. In addition, a second blanket order provides a prospectus exemption for companies that will be going or have recently gone public in Canada through an underwritten IPO, giving them greater flexibility to raise additional capital following the IPO provided certain conditions are met.  Furthermore, in a third blanket order in Alberta, New Brunswick, Nova Scotia, Ontario, Québec and Saskatchewan, the investment limit in the offering memorandum exemption will increase for certain eligible investors to allow for reinvestment of proceeds within a 12-month period, subject to certain terms and conditions. There is no such limit in the other CSA jurisdictions. Market participants, investor advocates and interested stakeholders with feedback on these initiatives are encouraged to contact their principal regulator. The CSA continues to explore other opportunities and actions to further support businesses and investors across Canada’s capital markets. The measures announced today are being implemented through coordinated blanket orders, which are effective on April 17, 2025. Market participants should consult the blanket orders for details of their expiry dates, where applicable. The CSA, the council of the securities regulators of Canada’s provinces and territories, co-ordinates and harmonizes regulation for the Canadian capital markets.

The Canadian Securities Administrators (CSA) today published amendments to National Instrument 81-102 Investment Funds pertaining to reporting issuer investment funds that seek to invest directly or indirectly in crypto assets (Public Crypto Asset Funds). The amendments are intended to provide greater regulatory clarity with respect to certain matters regarding Public Crypto Asset Funds, including:  Criteria regarding the types of crypto assets that Public Crypto Asset Funds are permitted to purchase or hold. Restrictions on investing in crypto assets by Public Crypto Asset Funds or other types of reporting issuer investment funds, and Requirements concerning custody of crypto assets held on behalf of a Public Crypto Asset Fund. “Canadian securities regulators are committed to enhancing investor protections and supporting the stability and strength of our capital markets,” said Stan Magidson, CSA Chair and Chair and CEO of the Alberta Securities Commission. “By implementing regulations around crypto asset offerings, we aim to provide guardrails in this evolving sector.”  With these amendments, the CSA aims to facilitate new product development while also ensuring that appropriate investor protection measures are built directly into the investment fund regulatory framework.  The CSA, the council of the securities regulators of Canada’s provinces and territories, coordinates and harmonizes regulation for the Canadian capital markets. For investor inquiries, please contact your local securities regulator.

The following Final Terms are available for viewing: Final Terms dated 17 April 2025 of LSEGA Financing plc for the (i)         JPY11,500,000,000 1.493 per cent. Guaranteed Notes due 24 April 2028 (ISIN: XS3056992848) (the 2028 Notes) (the 2028 Final Terms); (ii)       JPY14,300,000,000 1.732 per cent. Guaranteed Notes due 23 April 2030 (ISIN: XS3056992921) (the 2030 Notes) (the 2030 Final Terms); (iii)      JPY9,000,000,000 2.188 per cent. Guaranteed Notes due 23 April 2035 (ISIN: XS3056993226) (the 2035 Notes) (the 2035 Final Terms); and (iv)       JPY5,200,000,000 2.382 per cent. Guaranteed Notes due 23 April 2037 (ISIN: XS3056993812) (the 2037 Notes and together with the 2028 Notes, the 2030 Notes and the 2035 Notes, the Notes) (the 2037 Final Terms and together with the 2028 Final Terms, the 2030 Final Terms and the 2035 Final Terms, the Final Terms), unconditionally and irrevocably guaranteed by London Stock Exchange Group plc and issued pursuant to the £10,000,000,000 Euro Medium Term Note Programme of London Stock Exchange Group plc, LSEGA Financing plc, LSEG Netherlands B.V. and LSEG US Fin Corp. (the Programme). The Final Terms contain the final terms of the Notes and must be read in conjunction with the offering circular dated 28 March 2025 relating to the Programme (the Offering Circular), which constitutes a base prospectus for the purposes of the Prospectus Regulation (EU) 2017/1129 as it forms part of domestic law in the United Kingdom by virtue of the European Union (Withdrawal) Act 2018. To view the 2028 Final Terms for the 2028 Notes, please paste the following URL into the address bar of your browser: http://www.rns-pdf.londonstockexchange.com/rns/5278F_1-2025-4-17.pdf To view the 2030 Final Terms for the 2030 Notes, please paste the following URL into the address bar of your browser: http://www.rns-pdf.londonstockexchange.com/rns/5278F_2-2025-4-17.pdf To view the 2035 Final Terms for the 2035 Notes, please paste the following URL into the address bar of your browser: http://www.rns-pdf.londonstockexchange.com/rns/5278F_3-2025-4-17.pdf To view the 2037 Final Terms for the 2037 Notes, please paste the following URL into the address bar of your browser: http://www.rns-pdf.londonstockexchange.com/rns/5278F_4-2025-4-17.pdf A copy of each of the Final Terms has been submitted to the National Storage Mechanism and will shortly be available for inspection at: https://data.fca.org.uk/#/nsm/nationalstoragemechanism

Good afternoon, the Vice-President and I welcome you to our press conference. The Governing Council today decided to lower the three key ECB interest rates by 25 basis points. In particular, the decision to lower the deposit facility rate – the rate through which we steer the monetary policy stance – is based on our updated assessment of the inflation outlook, the dynamics of underlying inflation and the strength of monetary policy transmission. The disinflation process is well on track. Inflation has continued to develop as staff expected, with both headline and core inflation declining in March. Services inflation has also eased markedly over recent months. Most measures of underlying inflation suggest that inflation will settle at around our two per cent medium-term target on a sustained basis. Wage growth is moderating, and profits are partially buffering the impact of still elevated wage growth on inflation. The euro area economy has been building up some resilience against global shocks, but the outlook for growth has deteriorated owing to rising trade tensions. Increased uncertainty is likely to reduce confidence among households and firms, and the adverse and volatile market response to the trade tensions is likely to have a tightening impact on financing conditions. These factors may further weigh on the economic outlook for the euro area. We are determined to ensure that inflation stabilises sustainably at our two per cent medium-term target. Especially in current conditions of exceptional uncertainty, we will follow a data-dependent and meeting-by-meeting approach to determining the appropriate monetary policy stance. In particular, our interest rate decisions will be based on our assessment of the inflation outlook in light of the incoming economic and financial data, the dynamics of underlying inflation and the strength of monetary policy transmission. We are not pre-committing to a particular rate path. The decisions taken today are set out in a press release available on our website. I will now outline in more detail how we see the economy and inflation developing and will then explain our assessment of financial and monetary conditions. Economic activity The economic outlook is clouded by exceptional uncertainty. Euro area exporters face new barriers to trade, although their scope remains unclear. Disruptions to international commerce, financial market tensions and geopolitical uncertainty are weighing on business investment. As consumers become more cautious about the future, they may hold back from spending as well. At the same time, the euro area economy has been building up some resilience against the global shocks. The economy is likely to have grown in the first quarter of the year, and manufacturing has shown signs of stabilisation. Unemployment fell to 6.1 per cent in February, its lowest level since the launch of the euro. A strong labour market, higher real incomes and the impact of our monetary policy should underpin spending. The important policy initiatives that have been launched at the national and EU levels to increase defence spending and infrastructure investment can be expected to bolster manufacturing, which is also reflected in recent surveys. In the present geopolitical environment, it is even more urgent for fiscal and structural policies to make the euro area economy more productive, competitive and resilient. The European Commission’s Competitiveness Compass provides a concrete roadmap for action, and its proposals, including on simplification, should be swiftly adopted. This includes completing the savings and investment union, following a clear and ambitious timetable, which should help savers benefit from more opportunities to invest and improve firms’ access to finance, especially risk capital. It is also important to rapidly establish the legislative framework to prepare the ground for the potential introduction of a digital euro. Governments should ensure sustainable public finances in line with the EU’s economic governance framework and prioritise essential growth-enhancing structural reforms and strategic investment. Inflation Annual inflation edged down to 2.2 per cent in March. Energy prices fell by 1.0 per cent, after a slight rise in February, while food price inflation rose to 2.9 per cent in March, from 2.7 per cent in February. Goods inflation was stable at 0.6 per cent. Services inflation fell again in March, to 3.5 per cent, and it now stands half a percentage point below the rate recorded at the end of last year. Most indicators of underlying inflation are pointing to a sustained return of inflation to our two per cent medium-term target. Domestic inflation has declined since the end of 2024. Wages are gradually moderating. In the last quarter of 2024 annual growth in compensation per employee stood at 4.1 per cent, down from 4.5 per cent in the previous quarter. Rising productivity also meant that unit labour costs grew more slowly. The ECB’s wage tracker and information from our contacts with companies point to a decline in wage growth in 2025, as also indicated in the March staff projections. Unit profits fell at an annual rate of 1.1 per cent at the end of last year, contributing to lower domestic inflation. Most measures of longer-term inflation expectations continue to stand at around 2 per cent, which supports the sustainable return of inflation to our target. Risk assessment Downside risks to economic growth have increased. The major escalation in global trade tensions and associated uncertainties will likely lower euro area growth by dampening exports, and it may drag down investment and consumption. Deteriorating financial market sentiment could lead to tighter financing conditions, increase risk aversion and make firms and households less willing to invest and consume. Geopolitical tensions, such as Russia’s unjustified war against Ukraine and the tragic conflict in the Middle East, also remain a major source of uncertainty. At the same time, an increase in defence and infrastructure spending would add to growth. Increasing global trade disruptions are adding more uncertainty to the outlook for euro area inflation. Falling global energy prices and appreciation of the euro could put further downward pressure on inflation. This could be reinforced by lower demand for euro area exports owing to higher tariffs, and a re-routing of exports into the euro area from countries with overcapacity. Adverse financial market reactions to the trade tensions could weigh on domestic demand and thereby also lower inflation. By contrast, a fragmentation of global supply chains could raise inflation by pushing up import prices. A boost in defence and infrastructure spending could also raise inflation over the medium term. Extreme weather events, and the unfolding climate crisis more broadly, could drive up food prices by more than expected. Financial and monetary conditions Risk-free interest rates have declined in response to the escalating trade tensions. Equity prices have fallen amid high volatility and corporate bond spreads have widened around the globe. The euro has strengthened over recent weeks as investor sentiment has proven more resilient towards the euro area than towards other economies. The latest official statistics on corporate borrowing, which predated these market tensions, continued to indicate that our interest rate cuts had made it less expensive for firms to borrow. The average interest rate on new loans to firms declined to 4.1 per cent in February, from 4.3 per cent in January. Firms’ cost of issuing market-based debt declined to 3.5 per cent in February, but there has been some upward pressure more recently. Moreover, growth in lending to firms picked up again in February, to 2.2 per cent, while debt securities issuance by firms grew at an unchanged rate of 3.2 per cent. At the same time, credit standards for business loans tightened slightly again in the first quarter of 2025, as reported in our latest bank lending survey for the euro area. As in the previous quarter, this was mainly because banks are becoming more concerned about the economic risks faced by their customers. Demand for loans to firms decreased slightly in the first quarter, after a modest recovery in previous quarters. The average rate on new mortgages, at 3.3 per cent in February, increased on the back of earlier rises in longer-term market rates. Mortgage lending continued to strengthen in February, albeit at a still subdued annual rate of 1.5 per cent, as banks eased their credit standards and demand for loans to households continued to increase strongly. Conclusion The Governing Council today decided to lower the three key ECB interest rates by 25 basis points. In particular, the decision to lower the deposit facility rate – the rate through which we steer the monetary policy stance – is based on our updated assessment of the inflation outlook, the dynamics of underlying inflation and the strength of monetary policy transmission. We are determined to ensure that inflation stabilises sustainably at our two per cent medium-term target. Especially in current conditions of exceptional uncertainty, we will follow a data-dependent and meeting-by-meeting approach to determining the appropriate monetary policy stance. In particular, our interest rate decisions will be based on our assessment of the inflation outlook in light of the incoming economic and financial data, the dynamics of underlying inflation and the strength of monetary policy transmission. We are not pre-committing to a particular rate path. In any case, we stand ready to adjust all of our instruments within our mandate to ensure that inflation stabilises sustainably at our medium-term target and to preserve the smooth functioning of monetary policy transmission. We are now ready to take your questions.

Thank you for the opportunity to speak to you today about artificial intelligence (AI) and cybersecurity.1 In the past, a skilled forger could pass a bad check by replicating a person's signature. Now, advances in AI can do much more damage by replicating a person's entire identity. This technology—known as deepfakes—has the potential to supercharge identity fraud. I've recently spoken about the importance of recognizing both the benefits and the risks of generative AI (Gen AI).2 Today, I'd like to focus more on the darker side of the technology—specifically how Gen AI has the potential to enable deepfake technology, and what we should be doing now to defend against this risk in finance. Escalating Threat of Gen-AI Facilitated CybercrimeCybercrime is on the rise, and cybercriminals are increasingly turning to Gen AI to facilitate their crimes. Criminal tactics are becoming more sophisticated and available to a broader range of criminals. Estimates of direct and indirect costs of cyber incidents range from 1 to 10 percent of global GDP.3 Deepfake attacks have seen a twentyfold increase over the last three years.4 Cybercrime with deepfakes involves the same cat and mouse game common to sophisticated criminal activity. Both cybercriminals and financial institutions are constantly trying to outdo each other. Criminals develop new attack methods, and companies respond with better defenses. Here, the same technological innovations that enable the bad actors can also help those fighting cybercrime. However, there is an asymmetry—the fraudsters can cast a wide net of approaches and target a wide number of victims, and they only need a small number to be successful. Their marginal cost is generally low, and individual failures matter little. Conversely, companies must undergo a rigorous review and testing process to mount effective cyber defenses and will thus be slower in developing their defenses. A single failure is very costly. As we consider this issue from a policy perspective, we need to take steps to make attacks less likely by raising the cost of the attack to the cybercriminals and lowering the costs of defense to financial institutions and law enforcement. Anatomy of a DeepfakeDeepfake attacks are those in which an attacker uses Gen AI to create a doppelganger with a person's voice or image and uses this doppelganger to interact with individuals or institutions to commit fraud. Deepfake technology is a particularly pernicious vehicle for cybercrime.5 The process begins with voice synthesis, where Gen AI models can synthesize the speech of their victim not only in words, but also in phrase patterns, tone, and inflection. With just a short sample audio, for example, criminals assisted by Gen AI can impersonate a close relative in a crisis situation or a high-value bank client, seeking to complete a transaction at their bank.6 Criminals can also use Gen AI-generated videos to create believable depictions of individuals. For videos, Generative Adversarial Networks (GANs) are the core technology behind most deepfake systems.7 GANs consist of two competing models, the generator and the discriminator, which compete with and improve each other. This competition results in increasingly realistic, indistinguishable fake images and videos.8 Deepfake technology can also be augmented by other AI tools; for instance, criminals can use AI to extract and organize extensive multimodal personal data to facilitate identity verification. Attackers can also turn to "dark web" tools, such as jailbroken versions of popular large language models, where the guardrails have been removed, to learn the deepfake trade and improve their attacks.9 Deepfakes in ActionI expect that many of you can recall examples of how deepfakes of politicians and prominent business executives have fooled the public and spread disinformation. Deepfakes are also being used to commit payment fraud. In one case in 2024, a sophisticated deepfake of the chief financial officer for British engineering and architectural firm Arup was reportedly deployed in a video meeting and convinced an Arup financial employee to transfer $25 million to thieves.10 In another case, an attacker attempted to undertake a highly convincing audio deepfake of the chief executive of Ferrari, down to mimicking his southern Italian accent.11 The recipient of the attack—another Ferrari executive—tested the caller with a personal question only the chief executive would know, which thankfully exposed the fraud. And these institutions and individuals are not alone—a 2024 survey finds that over 10 percent of companies reported experiencing deepfake fraud attempts, and few steps have been taken to mitigate the risks.12 Particularly since COVID, we conduct much of our professional and personal lives over video. When we see realistic and interactive video images of a loved one in trouble, we are disposed to trust them and do what we can to help. Identity verification standards at banks often use voice detection, which may become vulnerable to Gen AI tools. If this technology becomes cheaper and more broadly available to criminals—and fraud detection technology does not keep pace—we are all vulnerable to a deepfake attack. These attacks can have significant financial costs to the victims of the crime and can also pose costs to society, eroding trust in communications and in institutions. Defending Against DeepfakesSo what should we do? As I mentioned above, we should take steps to lessen the impact of attacks by making successful breaches less likely, while making each attack more resource-intensive for the attacker. Let me start with ways to make successful breaches less likely. A key step is to recognize the importance of strong, resilient financial institutions in preventing attacks. Banks are frontline defenders against deepfake-enabled fraud due to their direct involvement with financial transactions and customer data. To verify payors, banks maintain identity verification processes, including multi-factor authentication and account monitoring practices. To the extent deepfakes increase, bank identity verification processes should evolve in kind to include AI-powered advances such as facial recognition, voice analysis, and behavioral biometrics to detect potential deepfakes. Other techniques focus on assessing the probability that AI has been used in audio or video based on underlying metadata and then flagging the identity or transaction for further review using other verification. These technical solutions can detect subtle inconsistencies in video and audio that human observers may miss. Banks have two points of control over the transaction—confirming not only the sender's identity, but also the legitimacy of the recipient address. They can scrutinize the recipients of large or unusual transactions, employing advanced analytics to flag suspicious patterns that could indicate fraudulent activities, and perform additional reviews before authorizing a payment to a recipient that raises flags. Banks also invest in their human controls by maintaining up-to-date training for staff on the emerging risks and incorporating the necessary security measures to mitigate the damages from breaches when they occur. And they are engaging with other financial institutions to help define the threat and identify appropriate controls and mitigants.13 Customers should do their part, enabling multi-factor authentication on their accounts and verifying unusual requests through a separate channel, even if the person making the request seems genuine. They should seek out education for themselves and their loved ones to help them detect and prevent fraud before it occurs.14 And customers should value strong security practices at their financial institutions, including those which may add some friction to the user experience. The customers that may be the highest-value targets for criminals are often those with the largest digital presence, and thus most susceptible to deepfakes. They are also the customers who may prefer the most frictionless user experience, making detecting deepfakes more difficult. When it comes to protecting our money, we ought to expect and appreciate a little friction. Regulators can help to reinforce the importance of cyber defenses in safe and sound banking through appropriate updates to guidance and regulation. As with all rules, we should be mindful of the impacts on smaller institutions and help ensure that rules are right-sized for the risk. In addition, we can work with core providers to understand the extent to which they are incorporating AI advancements in their products and services to help smaller banks defend against deepfakes and other emerging risks from the technology. Last, we can also highlight research and development for cybersecurity startups and research into tools to combat deepfakes and Gen AI-based fraud. Regulators should consider how we could leverage AI technologies ourselves, including to enhance our ability to monitor and detect patterns of fraudulent activity at regulated institutions in real time. This could help provide early warnings to affected institutions and broader industry participants, as well as to protect our own systems. In addition to preventing attacks, we should also explore ways of making attacks more costly. These may include coordination with domestic and global law enforcement, internationally consistent laws against cybercrime, and continued improvement on sharing threat intelligence and insights in real-time. The official sector and banks should continue efforts to improve fraud data sharing within the financial sector and help institutions respond more quickly to emerging Gen AI-driven threats. This will make it far harder for fraudsters to operate undetected, increasing the complexity and cost of their activities. But the sharing is only as good as the data, and banks must do their part. We should help ensure that banks and other regulated institutions meet their duties to report cyber incidents in a timely way, and regulators should too.15 Another way to disrupt the economics of cybercrime is by increasing penalties for attempting to use Gen AI to commit fraud and increasing investment in cybercrime enforcement. This includes targeting the upstream organizations that benefit from illegal action and strengthening anti-money-laundering laws to disrupt illicit fund flows and freeze assets related to cybercrime. The fear of severe legal consequences could help to deter bad actors from pursuing AI-driven fraud schemes in the first place. ConclusionDeepfakes are only one of many new techniques to facilitate cyberattacks, but they feel particularly salient because they are so personal. And they are on the rise. We will need financial institutions to adapt, collaborate, and innovate in the face of these emerging threats. Thank you. 1. The views expressed here are my own and are not necessarily those of my colleagues on the Federal Reserve Board or the Federal Open Market Committee.  2. Michael S. Barr, "Artificial Intelligence: Hypothetical Scenarios for the Future" (speech at the Council on Foreign Relations, New York, NY, February 18, 2025); Michael S. Barr, "AI, Fintechs, and Banks" (speech at the Federal Reserve Bank of San Francisco, San Francisco, CA, April 4, 2025).  3. International Monetary Fund, Global Financial Stability Report, chapter 3 (October 2024), See also, World Economic Forum, Why We Need Global Rules to Crack Down on Cybercrime (January 2023).  4. "Fraud attempts with deepfakes have increased by 2137% over the last three years," Signicat, February 20, 2025, https://www.signicat.com/press-releases/fraud-attempts-with-deepfakes-have-increased-by-2137-over-the-last-three-year#:~:text=Evolving20AI2Dbased20techniques20pose,AI2DDriven20Identity20Fraud20report.  5. Federal Bureau of Investigation, "Criminals Use Generative Artificial Intelligence to Facilitate Financial Fraud," public service announcement, December 3, 2024.  6. See note 5.  7. Tianxiang Shen, Ruixian Liu, Ju Bai, and Zheng Li, "Deep Fakes" Using Generative Adversarial Networks (GAN) (PDF). McAfee, Beware the Artificial Impostor (May 2023), https://www.mcafee.com/content/dam/consumer/en-us/resources/cybersecurity/artificial-intelligence/rp-beware-the-artificial-impostor-report.pdf.  8. "What is a GAN?" AWS, https://aws.amazon.com/what-is/gan/#:~:text=A20generative20adversarial20network20(GAN,from20a20database20of20songs.  9. KELA, The State of Cybercrime 2025 Report (February 2025), https://www.kelacyber.com/resources/research/state-of-cybercrime-2025/.  10. Kathleen Magramo, "British Engineering Giant Arup Revealed as $25 Million Deepfake Scam Victim," CNN Business, May 17, 2024, https://www.cnn.com/2024/05/16/tech/arup-deepfake-scam-loss-hong-kong-intl-hnk/index.html.  11. Sandra Galletti and Massimo Pani, "How Ferrari Hit the Brakes on a Deepfake CEO," MIT Sloan Management Review, January 27, 2025.  12. Chad Brooks, "1 in 10 Executives Say Their Companies Have Already Faced Deepfake Threats," business.com, June 28, 2024, https://www.business.com/articles/deepfake-threats-study/.  13. See, for instance, FS-ISAC's report on deepfake threats and risk management at https://www.fsisac.com/hubfs/Knowledge/AI/DeepfakesInTheFinancialSector-UnderstandingTheThreatsManagingTheRisks.pdf.  14. There are a variety of public and private resources that can help. See, for example, the National Security Agency/Central Security Service at https://www.nsa.gov/Press-Room/Press-Releases-Statements/Press-Release-View/Article/3523329/nsa-us-federal-agencies-advise-on-deepfake-threats/; and the National Cybersecurity Alliance at https://www.staysafeonline.org/articles/why-your-family-and-coworkers-need-a-safe-word-in-the-age-of-ai.  15. "Computer-Security Incident Notification Requirements for Banking Organizations and Their Bank Service Providers," 86 Fed. Reg. 66,424 (November 23, 2021).