AI in Focus: Differentiating Narratives from Reality in Non-Bank Financials
Author: Rasib Bhanji
August 20, 2026
Artificial intelligence (AI) has been the dominant theme in equity markets throughout 2026. Investors have largely focused on the hyper-scalers – primarily the “Magnificent Seven” – and their enormous investments in AI infrastructure. Yet large-cap technology is only part of the story as AI is reshaping industries across sectors.
This edition of AI in focus puts non-bank financials in the spotlight.
Non-bank financials endured a tumultuous first half of 2026 for two reasons: the perception of technological disruption and regulatory uncertainty. Tech—and increasingly AI-enabled platforms—is accelerating the narrative that financial services businesses are ripe for dis-intermediation. Specifically, if financials are service-oriented businesses run by people, why can’t AI that is supposedly as intelligent just replace them?
Meanwhile, the Trump administration’s deregulatory agenda has boosted activity across capital markets, benefiting investment banks and trading-focused brokers by facilitating higher trading volumes and increased mergers and acquisitions activity. On the other end, Trump’s vocal critiques of credit card swipe fees and his administration’s regulatory stance on exchange market infrastructure have raised concerns around the moat of the payment networks and the established exchanges. The Commodity Futures Trading Commission approval of perpetual Bitcoin futures on platforms such as Kalshi and Coinbase are a notable example.
It’s not all bad, though. Among the many pockets of dislocated sectors, the wealth management sector stands out. The market’s initial fear that AI would make wealth advisory redundant has yet to be proven true. Robo-advisors, first introduced in 2016, still manage less than 2% of U.S. advisory mediated total addressable market. People and relationships are still what make this business tick.
Rather than replacing advisors, AI is providing more value as a productivity tool. Companies are improving their margins by automating administrative tasks without materially changing the client experience they provide.
However, non-bank financials remain an impatient market. Companies are often punished hard for missing guidance, especially when management provides weak explanations. Consistent execution continues to matter in this space.
Growth is therefore more important than ever, whether measured by users or assets under management. It’s a readthrough as to whether a company is gaining or losing market share. Beyond growth, the question is whether margins can be sustained or improved as competition intensifies and traditional moats come under pressure.
AI is also exposing businesses with weak moats, such as data and info services companies that just repackage publicly available data. Investors are increasingly questioning the value of these business models with so much information at their disposal.
This increased sophistication and resilience of the retail investor is making the trading environment more interesting right now. Overall volume is rising on the back of low trading fees, the accessibility of institutional-level tools and data, and the proliferation of new products.
The companies that stand to benefit the most within this space are those participating in this structural upswing while also creating new opportunities through tokenization, prediction markets, and early access to IPOs, among other activities. Ultimately, the winners moving forward are likely to be the companies that best use technology to strengthen their competitive position. As AI lowers barriers to entry and regulation reshapes market structure, the ability to attract assets, deepen client relationships, and expand margins will become increasingly important differentiators. Strong execution matters more than ever before.
The views expressed in this blog are those of the author and do not necessarily represent the opinions of AGF, its subsidiaries or any of its affiliated companies, funds, or investment strategies.
Commentary and data sourced from Bloomberg, Reuters and other news sources unless otherwise noted. The commentaries contained herein are provided as a general source of information based on information available as of August 11, 2026. It is not intended to address the needs, circumstances, and objectives of any specific investor. The content of this commentary is not to be used or construed as investment advice, as an offer to buy or sell any securities, and is not intended to suggest taking or refraining from any course of action. Every effort has been made to ensure accuracy in these commentaries at the time of publication, however, accuracy cannot be guaranteed. Market conditions may change and AGF Investments accepts no responsibility for individual investment decisions arising from the use or reliance on the information contained herein.
References to specific securities are presented to illustrate the application of our investment philosophy only and are not to be considered recommendations by AGF Investments. The specific securities identified and described herein do not represent all of the securities purchased, sold or recommended for the portfolio, and it should not be assumed that investments in the securities identified were or will be profitable.
This document may contain forward-looking information that reflects our current expectations or forecasts of future events. Forward-looking information is inherently subject to, among other things, risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed herein.
For Canadian investors: Commissions, trailing commissions, management fees and expenses all may be associated with investment fund investments. Please read the prospectus before investing. Investment funds are not guaranteed, their values change frequently, and past performance may not be repeated.
AGF Investments is a group of wholly owned subsidiaries of AGF Management Limited, a Canadian reporting issuer. The subsidiaries included in AGF Investments are AGF Investments Inc. (AGFI), AGF Investments LLC (AGFUS) and AGF International Advisors Company Limited (AGFIA). AGFI is registered as a portfolio manager across Canadian securities commissions. AGFUS is a registered investment advisor with the U.S. Securities Exchange Commission. AGFIA is regulated by the Central Bank of Ireland and registered with the Australian Securities & Investments Commission. The term AGF Investments may refer to one or more of these subsidiaries or to all of them jointly. This term is used for convenience and does not precisely describe any of the separate companies, each of which manages its own affairs.
AGF Investments entities only provide investment advisory services or offers investment funds in the jurisdiction where such firm, individuals and/or product is registered or authorized to provide such services. Investment advisory services for U.S. persons are provided by AGFUS.
® / TM The “AGF” logo and all associated trademarks are registered trademarks or trademarks of AGF Management Limited and used under license.
RO: 20260811-5826714
About AGF Management Limited
Founded in 1957, AGF Management Limited (AGF) is an independent and globally diverse asset management firm. Our companies deliver excellence in investing in the public and private markets through three business lines: AGF Investments, AGF Capital Partners and AGF Private Wealth.
AGF brings a disciplined approach, focused on incorporating sound, responsible and sustainable corporate practices. The firm’s collective investment expertise, driven by its fundamental, quantitative and private investing capabilities, extends globally to a wide range of clients, from financial advisors and their clients to high-net worth and institutional investors including pension plans, corporate plans, sovereign wealth funds, endowments and foundations.
Headquartered in Toronto, Canada, AGF has investment operations and client servicing teams on the ground in North America and Europe. AGF serves more than 800,000 investors. AGF trades on the Toronto Stock Exchange under the symbol AGF.B.
For further information, please visit AGF.com.
© 2026 AGF Management Limited. All rights reserved.
