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European FSI Technology Priorities: Insights to Jumpstart Financial Innovation

Financial institutions across EMEA are confronting a defining moment. Competition is intensifying while customer expectations continue to rise. Regulatory requirements, including the Digital Operational Resilience Act (DORA) and data sovereignty mandates, are more complex and costly than ever. And technology—fueled by artificial intelligence (AI) innovation—is evolving at lightning pace.

Technological innovation is essential but demands careful execution. Most firms recognize this balance and are actively seeking ways to adopt it faster, more securely, and with greater confidence to drive measurable business outcomes. AWS commissioned Celent’s “Delivering Agility: FSI Technology Priorities in 2025/26” report to provide EMEA financial institutions with actionable intelligence. Drawing on engagement with hundreds of EMEA firms, it reveals how institutions are adapting to rapid change and accelerating digital transformation. We share five actionable insights from the report that will help EMEA financial institutions successfully navigate the path forward.

Insight 1: AI adoption is accelerating, and firms that scale it effectively will win

The Trend: AI and advanced analytics emerged as the top technology investment priority across all financial services segments in the study—retail and corporate banking, capital markets (buy and sell side), and life and property/casualty (P&C) insurance. In retail banking, 45% of institutions identified this as a key focus area, while European buy-side firms showed similar prioritization at 46%.

Why It Matters: The shift from AI experimentation to production deployment is accelerating rapidly in EMEA, with 67% of banks planning to launch customer-facing generative AI services in 2026 European buy-side firms are focusing generative AI investments on portfolio implementation systems (51%) and portfolio management applications (43%), while sell-side firms are applying the technology primarily to front-office workflows. Moving forward, the ability to scale production will be key to optimizing the impact of this powerful technology.

How AWS Helps: AWS enables financial institutions to implement and scale AI rapidly, securely, and cost-effectively—a proven advantage in competitive markets. AWS delivers the most comprehensive set of capabilities for financial services organizations—from enterprise-grade security and regulatory compliance, cost-competitive infrastructure, and flexible model choice to the ability to leverage proprietary data as a differentiator. AWS is focused on helping our customers optimize market differentiation through the ability to move rapidly and confidently from AI prototype to production. Amazon Nova, with its foundation-model intelligence and agentic capabilities, is only one example of how we’re delivering on this commitment.

Insight 2: Business-critical workloads are moving closer to cloud maturity while resiliency and data residency requirements remain persistent challenges

The Trend: Cloud migration remains a cornerstone of modernization efforts, with 56% of banks expecting to move more workloads to public cloud infrastructure and 58% planning to move business-critical workloads to the cloud. European sell-side firms show increased confidence in cloud adoption, with a significant uptick in plans to move business-critical workloads.

Why It Matters: The migration of core systems to the cloud is enabling both operational resilience and innovation in EMEA financial institutions. This shift is particularly significant given the region’s regulatory requirements and emphasis on data sovereignty.

How AWS Helps: AWS already provides the most advanced set of sovereignty controls and features available in the cloud today. The AWS Digital Sovereignty Pledge commits to delivering customers the most advanced sovereignty control. Building on our eight existing European Regions, AWS has introduced the AWS European Sovereign Cloud to meet the most stringent EU-specific regulatory requirements. With 140+ security certifications (ISO standards, GDPR, PCI-DSS), AWS’s sovereign-by-design approach empowers customers with granular data residency, autonomous EU-based operations, and hardware-enforced access restrictions via the AWS Nitro System—ensuring complete control over data location, encryption across transit, rest, and memory, and built-in resilience. This approach ensures financial services institutions can meet the most stringent European data sovereignty requirements, providing the foundation for building highly available and resilient applications that comply with regional regulations.

The new AWS European Sovereign Cloud is designed to offer additional choice to all our customers, including financial services institutions. It is a full featured, independently operated sovereign cloud, backed by strong technical controls, sovereign assurances, and legal protections designed to meet the needs of European governments and enterprises. It has no critical dependencies on non-EU infrastructure and keeps all customer-created metadata within the EU. The environment operates under a dedicated EU-based parent company with EU-citizen resident leadership. We see customers looking at the AWS European Sovereign Cloud in instances in which customers need additional assurances on operational autonomy and data residency.

Insight 3: Regulatory compliance requires substantial technology investment, which can slow innovation timelines.

The Trend: Firms are allocating substantial portions of their technology budgets to fulfill regulatory requirements, with 18% of IT spending dedicated to mandatory changes. More onerous requirements and the cost to implement them have a negative impact on the pace of innovation. More than half (58%) of buy-side capital market firms in the study cited a “crowding out effect” associated with regulation, where onerous regulatory requirements and delivery of mandatory obligations become barriers or constraints to product enhancements or innovation.

Why It Matters: The tension between regulatory compliance and innovation presents a strategic challenge for EMEA financial institutions. Those that can efficiently address compliance needs while continuing to invest in growth-oriented initiatives will secure a definitive competitive advantage.

How AWS Helps: AWS enables financial institutions to deploy AI at scale while maintaining regulatory compliance through purpose-built infrastructure. AWS Regions—including the European Sovereign Cloud and dedicated European deployments—ensure data residency requirements are met, while Amazon GuardDuty and AWS Artifact automate threat detection and compliance documentation. This integrated compliance layer allows financial institutions to deploy AI and machine learning models more efficiently, accelerating innovation while maintaining adherence to DORA, GDPR, and financial services regulations.

Insight 4: Technical debt continues to impact agility and competitive differentiation.

The Trend: The burden of technical debt continues to be a significant barrier to innovation across EMEA. Approximately 37% of banks cite limitations of existing technologies as a major constraint to delivering product enhancements.

Why It Matters: Financial institutions that prioritize legacy system modernization will be better positioned to enhance customer experiences, improve operational efficiency, and respond to competitive threats. This is particularly important in the fragmented EMEA market. There is little debate over the need for modernization. The challenge is how to accomplish it faster, with less risk, and in a manner that aligns best with the institution and its business strategy.

How AWS Helps: AWS offers financial institutions multiple modernization pathways—from lift-and-shift migrations to full application refactoring. AWS managed services reduce operational overhead, freeing IT teams to focus on innovation rather than infrastructure maintenance. The AWS Migration Acceleration Program for Financial Services provides specialized tools, guidance, and financial incentives to accelerate legacy modernization while managing risk.

Insight 5: Agentic AI will significantly improve operational efficiency and decision-making in financial services.

The Trend: While GenAI has dominated headlines, EMEA financial institutions are quickly recognizing the transformative potential of agentic AI systems that can autonomously perform complex tasks and make decisions. The report highlights “agent chaining”—combining specialized AI agents to support entire workflows or customer journeys—as a particularly powerful approach for financial services.

Why It Matters: Agentic AI has the potential to revolutionize straight-through processing in capital markets, transform underwriting in insurance, and create entirely new customer service paradigms in banking. The report also notes that “very few investment managers are ready to allow AI to function and make decisions autonomously due to perceived risks without human oversight,” highlighting the importance of developing robust governance frameworks.

How AWS Helps: AWS infrastructure enables reliable, secure AI agents at scale. Amazon Bedrock AgentCore enables financial institutions to build, deploy, and manage autonomous AI agents across complex financial workflows. For EMEA institutions exploring agent chaining, this capability is particularly relevant.

AWS prioritizes control, security, and auditability—ensuring organizations can deploy agentic AI with appropriate governance and oversight. AWS European infrastructure and the AWS European Sovereign Cloud allow financial institutions to build and deploy AI solutions that comply with European data sovereignty requirements.

Building Agility for the Future

The Celent report provides important insights into how EMEA financial institutions are navigating technological transformation. In 2026, the organizations that will thrive are those that balance operational resilience with customer-centric innovation, leverage the power of AI (including agentic AI), and accelerate modernization of their technology foundations.

At AWS, we’re committed to supporting EMEA financial institutions on this journey, providing the secure, scalable infrastructure and advanced services needed to deliver the agility that will define success in the years ahead.

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Andrew Renzella

Andrew Renzella

Andrew leads the AWS global financial services industry analyst program, where he shapes and drives strategic engagement in the financial services sector. Andrew brings 20 years of financial services experience to AWS, having held leadership positions at Celent and Oliver Wyman, where he led go-to-market functions across banking & payments, capital markets, and insurance.