AI, Governance and Banking Leadership

MTN looks to an AI-enabled future

MTN’s mobile money solution has enjoyed some major successes in recent years, including in Ghana where MoMo enjoys a dominant share after a few short years of operation. In the first half of 2026, MoMo Ghana earned profit after tax of 5.1 billion Cedi, while Ghana’s major banks earned profits of 1 billion Cedi or less. MTN’s chief executive Ralph Mupita said last week the business is looking at acquiring banking licences. “The big growth now, which will be the growth of the future, is actually lending," he told Reuters. (MTN currently does lending in partnership with banks.) “We're beginning to explore, where it makes sense and where there are large customer bases (and) significant floats in wallets, whether it may make sense to have some sort of banking licence that enables us to take deposits,” he said. “As such, we will then be lending over time off our own balance sheet. But also, it doesn't mean we won't do any partnership lending.”

Mobile money players have been partnering with banks for lending but they’ve also been working in three-way coalitions with fintechs offering machine-learning driven credit scoring for telco customers. Telcos have vast data gathering and analytics operation based on billions of transactions, and now it looks like they are planning major steps involving AI. MTN said recently it will be an investor in AI-enabled data centres for African markets, partnering with Gulf-based developers and initially targeting the Nigerian and South African markets. With developments towards data sovereignty and locally hosted data, this is a canny move by the telcos. Mazen Mroue, CEO of MTN Digital Infrastructure, said earlier this year that the company is investing in ‘Sovereign AI’ across the continent. Should banks now regard telcos as major threats to their business? Or should they double down on telco partnerships, accepting that the telcos will now be the major conduit to their customers?

Banks can’t keep up with AI flaw-finding

Frontier or leading AI models are finding vulnerabilities in bank security systems at a rate that is overwhelming banks’ abilities to fix them, say the UK financial regulator. The problem is particularly intense at banks that operate with merged IT systems or patched-up legacy systems, and it’s compounded by the amount of time it typically takes banks to work through governance processes to approve changes. “Attackers can already find and actively exploit a new vulnerability within hours, while many firms’ remediation cycles still run into weeks or months,” said Craig Parkin, associate managing director for cyber strategy and risk at consultants Kroll, the FT reports. “This will be especially difficult for older legacy systems, where weaknesses are often hard to remediate or have been risk accepted because they are unpatchable.” One solution, it seems, is to hire people who can accurately assess the levels of risk posed by different problems, so banks don’t end up chasing down all the low-risk problems while leaving high-risk issues unsolved. 
 
“In financial services cyber security matters more than almost anywhere,” said Nik Kairinos, head of Raids AI, which monitors AI systems. “When an AI system fails here, money moves, legal exposure follows and reputations built over decades can be damaged in minutes.” He added: “AI has moved faster than regulation can follow, and that gap is where the risk sits.

US courts find Silicon Valley Bank executives acted negligently

The story of Silicon Valley Bank and its sudden collapse serves as a case study in our teaching materials on governance and asset and liability management at Retail Banking Institute. As with many big financial stories, it’s taking several years to play out. The former parent company of the bank has tried to sue the FDIC, which insures bank deposits in the US, for

But last Friday, a US court ruled in favour of the FDIC, saying the former parent of the bank cannot pursue a $1.71 billion claim against the Federal Deposit Insurance Corporation. “Silicon Valley Bank collapsed after rising interest rates caused at least $4.52 billion of losses in the bank's investment portfolio, sparking a bank run that disrupted many technology startups whose deposits it held,” writes Reuters. “Most of the bank's deposits were uninsured. The bank's demise presaged the collapses of two other large lenders in 2023, Signature Bank and First Republic Bank.” US District Court judge Beth Freeman said that “the bank's chief financial officer, treasurer and others acted negligently by taking excessive interest rate and liquidity risks, with encouragement from the board of directors,” reports the newswire. “She rejected the trust's arguments that it was protected because directors exercised their business judgment in authorizing the investments, and the losses occurred only because the FDIC sold the securities at a loss. ‘The holding company chose to run the bank through holding company officers in accordance with the global, enterprise-wide policies, limits, and metrics that the holding company established,’ Freeman wrote. ‘Having made this choice, it must live with the consequences.’

Freeman ruled after a 12-day, non-jury trial. Silicon Valley Bank had about $209 billion of assets before it failed. The FDIC is also suing 17 of the bank's former executives and directors, including onetime Chief Executive Gregory Becker, to recover billions of dollars for alleged gross negligence and breaches of fiduciary duty. Washington Mutual is the largest traditional U.S. bank or thrift by assets to fail, collapsing in 2008. First Republic, Silicon Valley Bank and Signature rank second, third and fourth.”

HDFC looks for a new leader

HDFC’s, India’s largest privately-owned bank, is in line for new leadership after the abrupt resignation of its chief executive officer Sashidhar Jagdishan. His resignation follows the surprise exit in March this year of the chairman Atanu Chakraborty, who cited ethical difference with the bank. While he later tried to walk back the remarks, which were seen to refer to accountability and governance issues, the bank’s reputation took a hit, and cast doubt over the reappointment of Jagdishan. “Jagdishan’s decision not to seek reappointment ‘introduces a degree of leadership transition risk as the succession was not previously anticipated,’ said Devang Rajkotia, assistant vice president at Moody’s Ratings, reports Bloomberg. ‘An orderly succession process and continuity in strategy execution will be key to sustaining stakeholder confidence and limiting any negative credit implications.’ The lender is in talks to hire an executive search firm to fast-track the appointment of a new CEO, Bloomberg reported on Monday, citing people familiar with the plan.”

Beyond the accountability issues, HDFC share prices had not moved in recent years while shares of its competitors such as State Bank of India enjoyed a boost. “HDFC is one of India’s systemically important banks, commanding nearly 12% of the total deposit base as on June 30,” adds Bloomberg. “The race for the CEO job would pit several veterans within the lender against outsiders who could get a chance to lead India’s largest private sector bank.”

Tim Cook leaves the CEO seat at Apple

Another company getting a new chief executive is a tech business that has moved into the financial services industry over the past decade. John Ternus becomes the new head of Apple today, succeeding Tim Cook, who has led the company for 15 years since he took over from Steve Jobs in 2011. Cook oversaw the introduction of Apple Pay, which has become a huge success in the US in particular (where the iPhone is dominant), and the wallet now processes around 10 per cent of global card volume. Apple’s market capitalisation under Cook’s tenure rose from $350 billion to $4 trillion, occasionally holding the position of the world’s most valuable business, and annual revenue has quadrupled since 2011 to around $416 billion.