At the sixth banking supervision forum organized by the ECB, Buch stated that fiscal support in the eurozone during the COVID-19 pandemic crisis amounted to 4% of the Gross Domestic Product (GDP), with two-thirds of this support being direct assistance to businesses and workers.
In the subsequent years, the fiscal measures to address the surge in energy prices were of a similar magnitude, Buch added.
Buch questioned whether similar political support will be possible in a future crisis, considering the increased debt levels and strong fiscal pressures.
Banks should prepare for the next crisis with “strong capital and liquidity positions, robust governance, operational flexibility, and resilient information technology systems,” Buch noted.
Cyber and operational resilience should be a priority in banks’ risk management strategies.
The ECB conducted a cyberattack stress test in 2024.
Generally, banks are well-prepared to recover from a cyberattack, but there are areas needing improvement.
Exposures to external service providers could pose a threat considering the rising geopolitical risks.
Banks should thoroughly assess risks before utilizing cloud computing services, for instance.
Major cyberattacks on European banks have doubled in recent years and have become more frequent and severe.
Almost all of the 113 banks that the ECB directly supervises, the largest in the eurozone, have outsourced critical functions to external companies.
