Global – Financial services, US tariffs and retaliatory tariffs

There are currently no tariffs on financial services firms

The US has not imposed any tariffs on financial services firms and currently has no plans to do so.  The EU has the power to impose retaliatory measures against US banks and financial services firms under its Anti-Coercion Instrument (ACI), however, at the current time the EU has not invoked the AIC and is not yet imposing any such retaliatory measures.  The US tariffs and the EU retaliatory tariffs on goods do, however, have implications for the financial services markets as we set out below.

Equity markets and actively managed portfolios

In the short term, volatility in equity markets will make actively managed investment mandates more difficult to manage, and it is possible that some portfolios will need to be rebalanced to stay within strategic asset allocations (SAAs). In the medium to longer term, we may see an adjustment to those SAAs as managers move strategies to reflect the adjustments to global markets.

Government and corporate debt

As well as the short-term volatility in public debt, we may also see adjustments to credit ratings for both government and corporate debt, as manufacturing industries feel the impact of the tariffs (and any global retaliatory tariffs). In the most extreme cases, defaults and downgrades could cause further disruption. As with volatility in the equity markets, the overall impact on spreads could lead to longer-term adjustments in investment behaviours in the debt markets or a move to other, higher yielding assets, such as private debt or illiquids.

Derivatives

It is likely that existing derivatives positions will be impacted by the new tariffs - for example cross-currency hedges moving. In those cases, counterparties should expect further margin calls on those derivatives. Pricing on new derivatives may well also be affected, to reflect banks making revisions to their future expectations of financial markets.

Impact on contracts

Our Commercial Team has written a briefing on how tariffs can impact upon contracts, covering force majeure, change in law, material adverse change and variation provisions in the context of supply chain contracts, although the underlying contract law is of broader application and the same concepts can and do apply to contracts involving financial services firms.

• Read our client briefing “Dealing with the impact of tariffs on your supply chain”

How Eversheds Sutherland can help

The adoption of new technologies and operating models, industry consolidation, and regulatory changes create market disruption, risks, and opportunities. Regardless of the segment of the financial services industry you work in, we provide an industry-first approach, bringing a 360° perspective and novel solutions to help you adapt successfully to change and take advantage of the opportunities.

Our global team has in-depth knowledge of the financial services sector across all the regions where you conduct business. We represent many of the world’s largest financial institutions in groundbreaking projects that have shaped the industry landscape. Our experience and capabilities span the financial services ecosystem, including capital markets, wholesale and retail banking, insurance, asset management, financial sponsors and private capital, payment providers, fintechs, and all aspects of financial innovation.

We can support, including through the use of legal tech, whether you need help with a small number of key agreements or need to understand the position across your wider supply chain.

Further reading

EU countermeasure tariffs on US steel and aluminium | Eversheds Sutherland

Trump 2.0 - Tariffs and Deal Making | Webcast

President Trump’s “Liberation Day” Tariffs Come Into Force | Eversheds Sutherland

Global Supply Chain Horizons - March 2025 | Eversheds Sutherland

Home - Global Supply Chain Guide

How resilient are your contracts to changing prices? - Part 1 | Eversheds Sutherland

Varying prices once a contract is underway - Part 2 | Eversheds Sutherland

Dealing with pricing disputes - Part 3 | Eversheds Sutherland