Claudia Buch: Evidence-based supervision - addressing evolving risks, maintaining resilience
Keynote speech by Prof Claudia Buch, Chair of the Supervisory Board of the European Central Bank, at the Banking Supervision Research Conference 2025 "Technological innovations in financial markets – risks and opportunities in banking and regulation", Frankfurt am Main, 9 December 2025.
The views expressed in this speech are those of the speaker and not the view of the BIS.
Welcome to this year's Banking Supervision Research Conference. Last summer, when I spoke to this group, I talked about the "risk assessment paradox". Many analytical tools rely on past data. So at the precise moment when forward-looking risk assessments are needed to cut through uncertainty and identify emerging vulnerabilities, these tools may become less useful. This does not mean that we should stop doing analytical work. Quite the contrary: this is the time when we need to use a range of analytical approaches, compare results provided by different models, and apply judgement to draw lessons from the outcomes.
These considerations have, if anything, become more relevant over the past year, as some of the trends I described last summer have since intensified.
Some geopolitical risk scenarios that were fairly abstract last year have materialised in the meantime. Trade policy uncertainty has significantly increased with, so far, a relatively limited impact on credit losses and provisioning needs. However, the longer-term effects on banks may only unfold over time. Cyberattacks have increased in intensity and severity over the past few years, and these are a key concern for the risk management of many banks. Therefore, in September last year, we published a framework that can be used to analyse the impact of geopolitical risks on banks.