U.S. banks face rising pressure to modernize risk and decision-making

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Highlights

Moody's reports 46% of U.S. banks cite fragmented data systems, 40% lack unified cross-risk views, and 37% suffer from disconnected workflows, exposing major operational weaknesses.
Globally, more than 80% of banks identify legacy infrastructure and fragmented data as key constraints, with 92% reporting heightened competition from more agile institutions.
In response to intensifying competition and risk complexity, 39% of U.S. banks are hiring AI/data specialists, 35% recruit leaders for data-led transformation, and 41% prioritize credit risk improvements.

Survey findings highlight operational constraints

As reported by Moody’s, the industry’s current challenge centers less on cyclical disruption and more on long-running constraints in data management, workflows and decision-making. The report says 46% of banks cite fragmented data systems, 40% report an inability to produce a unified cross-risk view, and 37% point to disconnected workflows, underscoring operational weaknesses across many U.S. institutions.

At the global level, more than 80% of institutions identify legacy infrastructure and fragmented data as a major constraint, indicating the problem extends beyond individual markets. In the U.S., respondents describe legacy modernization and enterprise-wide data integration as practical obstacles to faster execution and more consistent decision-making across organizations.

As decision timelines shorten, the report says the effects of fragmentation become more pronounced. Banks that fail to connect systems and workflows may find that insight does not reliably translate into execution or business outcomes.

Competitive and risk pressures reshape bank strategy

Competitive pressure is increasingly tied not only to what banks offer, but to how effectively they execute. In the survey, 39% of banks report hiring AI and data specialists, while 35% are recruiting senior leaders with data-led transformation experience, reflecting efforts already under way at many U.S. institutions.

Globally, 92% of banks report pressure from faster and more agile competitors, suggesting that competitive intensity is unlikely to ease. In the U.S. market, that pressure is reinforced by private credit firms and fintech entrants, particularly in lending.

Risk functions are also becoming more integrated into core business activity rather than remaining solely a control layer at the end of processes. Survey data shows 41% of banks prioritizing risk improvements focus on credit risk, 32% are investing in early warning systems, and 39% are working toward integration across risk, finance and lending functions.

Our earlier article on Palantir’s expanded AI partnership with Nvidia outlined how the company is positioning its platforms for secure deployments across U.S. government and critical infrastructure, alongside growing adoption such as the U.S. Army’s selection of Palantir Foundry for command-and-control modernization. We also noted that, despite mixed technical signals and near-term consolidation risk, these high-impact partnerships were strengthening institutional demand and reinforcing the longer-term growth narrative.

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