Margarita Delgado: Remarks - BNP Paribas seminar with representatives of the banking sector

Remarks by Ms Margarita Delgado, Deputy Governor of the Bank of Spain, for the BNP Paribas seminar with representatives of the banking sector, Madrid, 28 September 2023.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Central bank speech  | 
28 September 2023

Prudential regulation is not calibrated to produce "zero failures". It aims to reduce the likelihood and impact of banking stress, while facilitating financial intermediation and economic growth.

Prudential regulation is sustained, from my point of view, by three pillars: Governance, Supervision and Regulation


The Global Financial Crisis was a painful but also a key episode that showed us the importance of a robust governance and risk management framework. These functions are the first line of defence of a sound and profitable business. In this regard, remarkable improvement has been achieved in the European framework during these years since then. However, challenges remain in implementing changes in the governance framework and making them effective.

Governance is an area where supervisors pay a lot of attention, because we are aware of the importance of a robust governance structure and functioning. An example of this is that 7,371 findings have been raised in this area since the SSM was created, of which 1,303 remain open. This is because there is always room for improvement and governance should not be seen as a static element. On the contrary, as new challenges arise (climate risks, ESG, digitalisation, etc.), governance needs to be updated to properly address them.

Therefore, governance has been, is and will be an area where supervisors will continue to pay attention. It is a clear priority and the cornerstone of our activity.