The Commission is working with the Isle of Man Financial Services Authority and the Jersey Financial Services Commission to encourage banks to adopt a consistent approach to dealing with “authorised push payment” (“APP”) fraud across the Crown Dependencies.

The framework proposed reflects high level principles and areas of common direction between the Crown Dependency financial services regulators.

Read the new framework here

Advances in frontier artificial intelligence (“AI”) models are reshaping the cyber risk landscape. These models are increasingly capable of identifying software vulnerabilities, including within large, complex and legacy code bases, at a speed and scale that was previously unattainable. Whilst these capabilities have the potential to enhance cyber resilience when used responsibly, they are also likely to accelerate the discovery of exploitable weaknesses across digital infrastructure.

The Commission does not want to heap new burdens on firms. Rather we have spent some time talking and listening to international counterparts and experts in the fields of AI and quantum computing all of whom seem to concur that these society changing technologies are advancing markedly faster than expected even a year ago, with threats increasing. In these relatively unprecedented circumstances we think it is proper to ask the leaders of the firms we regulate to review their technology risk management arrangements, including vulnerability management, patching processes and third-party oversight. The accompanying Dear CEO letter which we have issued to firms highlights relevant matters.

3 July 2026

Dear CEO

Ongoing Technology Risk and the Use of Advanced Vulnerability Discovery Tools

The Commission supports innovation and recognises the role that Artificial Intelligence (“AI”), in all forms, could play in transforming the way financial services are administered, managed and delivered at all levels (Policy Statement – Use of Artificial Intelligence — GFSC).   

Recent international developments, including the use of advanced AI tools to identify vulnerabilities within existing software, have demonstrated both the opportunities and risks arising from rapidly advancing technology. 

The Commission notes that such tools do not necessarily create new weaknesses; rather, they expose ones that already exist within systems relied upon by firms, customers and markets. This discovery capability can materially improve defensive arrangements, but it also reinforces the importance of continuous and proactive maintenance of technology environments. 

The Bailiwick’s principles‑based regulatory framework is deliberately designed to enable firms to embrace technological change without inhibiting innovation. It also places a responsibility on firms to ensure systems that are in use are subject to ongoing review and updates where appropriate. Firms should be satisfied that technology risk is not treated as static, but as an evolving exposure, requiring ongoing monitoring. 

It is important that the firms, understand the IT patching regime in place for its organisation, and that it remains appropriate, especially if, with recent developments, there is a need to rectify weaknesses in a significantly shortened timeframe without reducing checks and controls. If a firm is using a third-party outsourced provider, they should ensure that this outsourced provider is able to meet the ongoing needs of the firm with respect to this changing environment.  

I should be grateful if you could bring this letter to the attention of your Board and senior management.  

Yours sincerely, 

Conor Osborough
Director of Technology 

A new podcast from the Guernsey Financial Services Commission offers an audio companion to the Commission’s recently published 2025 Annual Report.

Produced by the Commission’s Technology Innovation Unit, the podcast uses AI-generated scripting, voices and music to help make the report and financial statements easier to explore.

The podcast takes listeners through the highlights of the Commission’s 2025 annual report, including progress on digital finance and a continued investment in technology alongside work to support innovation.

The report in full is available here

Guernsey Funds  

The total net asset value of Guernsey funds at the end of the quarter was £272.6 billion, a decrease over the quarter of £0.2 billion (-0.1%). Over the past year, total net asset values have decreased by £6.0 billion (-2.2%). 

Closed-ended Funds

Within these totals, Guernsey closed-ended funds increased over the quarter by £4.5 billion (+2.0%) to just under £229.0 billion.  This represents a decrease of £3.8 billion (-1.6%) in the past year.

Open-ended Funds  

The Guernsey-domiciled open-ended sector decreased over the quarter by £4.8 billion (-9.9%) to £43.6 billion.  This represents a decrease of £2.3 billion (-5.0%) in the past year.

Guernsey Sustainable Funds

Within these totals for Guernsey funds, Guernsey Sustainable Funds held a total net asset value of £4.4 billion at the end of the quarter.

The statistics are available here.

Enquiries to: Andrew Dempster, Deputy Director, Investment, Fiduciary and Pension Division

Tel: (01481) 712706   International Dialling Code: +44 1481   Email: adempster@gfsc.gg

The Guernsey Financial Services Commission has today published its 2025 Annual Report and Financial Statements, highlighting a year of regulatory delivery, policy reform and investment in technology to support innovation and growth in the Bailiwick’s financial services sector.

The report shows how the Commission worked through 2025 to maintain a credible and internationally respected regulatory framework, while helping ensure Guernsey remains a stable, competitive and forward-looking jurisdiction.

It also underlines the importance of engagement with industry, government and international partners, and the Commission’s focus on regulation that is proportionate, effective and designed to sustain growth.

Driving innovation and digital delivery

A major development in 2025 was the completion of the Applications & Authorisations Portal, giving industry a more user-friendly way to submit applications and communicate with the Commission. By the end of the year, more than 220 applications had been received through the portal.

The Commission also launched the Digital Finance Initiative working with industry through the Digital Forum to further develop Guernsey as a destination of choice for digital finance.

Policy and regulatory developments

Policy work during the year focused on supporting competitiveness and resilience across the jurisdiction. In additional to the DFI policy work, key developments included:

• Streamlining and enhancing the Private Investment Fund regime;
• Updating the Prospectus Rules and Guidance;
• Issuing feedback on sustainability reporting; and
• Introducing a regulatory framework for equity release products.

Together, these developments reflect the Commission’s focus on supporting innovation and growth while maintaining high standards and avoiding unnecessary burdens on well-managed firms.

Stable sector with ongoing opportunities

Against a backdrop of global uncertainty, the report notes that Guernsey’s financial services sector remained stable, supported by continued demand for investment funds and other investment and insurance entities.

The Commission also highlights the opportunities created by technological change, including AI, while recognising the need to manage increasing risks in areas such as cyber security and geo-political events.

Director General William Mason said: “In 2025, the Commission, having successfully concluded the MONEYVAL evaluation with the strong MONEYVAL report published in February which secured the foundations of our prosperity, we were able to refocus our finite capacities on what regulatory environment would be optimal for Guernsey's long term competitiveness over the next decade or so, taking into account the considerably changed international environment. Over the course of the year we made considerable improvements, working in partnership with thoughtful industry actors, the States and Guernsey Finance. We look forward to delivering further beneficial reforms through 2026 and beyond.”

Commission Chairman John Aspden added: “The Commission has continued to deliver strong regulatory outcomes while remaining responsive to change in the external environment. Our focus is on maintaining the Bailiwick’s reputation as a well-regulated and forward-looking jurisdiction, while supporting sustainable growth and protecting users of financial services.”

The Commission welcomes the announcement by the States of Guernsey regarding the inclusion of the Bailiwick in the recently concluded Free Trade Agreement between the United Kingdom and the Gulf Cooperation Council (GCC).

The agreement, concluded on 20 May 2026, represents a significant development in Guernsey’s international trading position and reflects the ongoing work of the States to ensure the island is included, where appropriate, in the United Kingdom’s evolving network of trade agreements.

The GCC comprises Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates, a region with which Guernsey has built substantial economic links over several decades.  

The Commission has developed memoranda of understanding with several jurisdictional regulators within the GCC over a number of years and it is heartening to see these built on through this intergovernmental agreement.

More information on the States of Guernsey announcement is available here: Read the States of Guernsey announcement

The Commission has today issued its report on its first thematic review conducted under the Lending, Credit and Finance regime.  The thematic review focused specifically on motor finance, assessing how well firms are complying with the new regulatory regime since it came into full effect in July 2023. 

‘Motor finance’, in the context of the thematic, refers to the various loans and credit agreements that help individuals to spread the cost of buying vehicles such as cars, motorbikes or scooters for their personal use.  In the Bailiwick, motor finance agreements commonly take the form of personal loans, hire purchase (HP), HP with a balloon payment and personal contract purchase (PCP) agreements.  

Included in the scope were two main types of firm – credit providers (or lenders) and credit brokers (usually motor traders or garages), who arrange loans on their customers’ behalf during the process of selling a vehicle.

As part of the thematic, a public survey was launched to gather the public’s personal experiences of obtaining motor finance in the Bailiwick. 

Alongside the survey, questionnaires were sent to lenders and brokers, desk-based reviews were undertaken, and 15 onsite visits were conducted, which provided a comprehensive picture of industry practice.

The findings of the thematic were broadly positive, with most firms demonstrating their commitment to meeting the requirements of the LCF legislation and embedding fair treatment of customers within their practices.  The key findings were as follows:

• Generally, firms are treating customers fairly
• Firms no longer use discretionary commissions arrangements, although improvements must be made to commissions disclosure processes
• Firms take into account the individual circumstances of those customers in arrears and consider a range of appropriate forbearance options
• Firms are generally providing their customers with the loan APR, in accordance with the Rules
• Motor finance advertising is generally clear, but compliance with the LCF Rules is inconsistent
• The information provided by firms to customers could be improved, to ensure that it is complete and (where relevant) accessible
• The quality of customer records held by motor traders could be enhanced

Looking ahead, where issues have been identified, we will work with firms through our ongoing supervision, to ensure that any necessary improvements are made.

A copy of the thematic review is available here or via the Commission’s Legislation and Guidance page under the ‘Thematic Reviews’ heading.  More information can also be found on the consumer pages on our website.

We would like to take the opportunity again to thank everyone who participated in the public survey.

Finally, we would also like to thank all participating firms for their cooperation throughout this process. Their engagement was instrumental in facilitating this assessment of industry practices.

Fourth Quarter 2025

Guernsey Funds  

The total net asset value of Guernsey funds at the end of the quarter was £272.8 billion, which is virtually unchanged from the previous quarter. Over the past year, total net asset values have decreased by £17.3 billion (-5.9%). 

Closed-ended Schemes

Within these totals, Guernsey closed-ended funds decreased over the quarter by £1.6 billion (-0.7%) to £224.4 billion.  This represents a decrease of just under £13.9 billion (-5.8%) in the past year.

Open-ended Schemes  

The Guernsey-domiciled open-ended sector increased over the quarter by £1.6 billion (+3.4%) to £48.4 billion.  This represents a decrease of £3.4 billion (-6.6%) in the past year.

Guernsey Sustainable Funds

Within these totals for Guernsey funds, Guernsey Sustainable Funds held a total net asset value of £4.5 billion at the end of the quarter.

The statistics are available here.

Enquiries to: Andrew Dempster, Deputy Director, Investment, Fiduciary and Pension Division

Tel: (01481) 712706   International Dialling Code: +44 1481   Email: adempster@gfsc.gg