Geopolitical risks and banking sector vulnerabilities: implications for the SSM
The EU economy is vulnerable and will be increasingly exposed to geopolitical risk arising from the less peaceful course of international relations.
This study was prepared for the European Parliament’s Committee on Economic and Monetary Affairs (ECON). The study is on the European Parliament’s online database, ‘ThinkTank‘. Copyright remains with the European Parliament at all times.
Geopolitical risk will increasingly confront EU banks and their supervisors in the coming years. This paper assesses four specific manifestations of this type of risk and the related banking vulnerabilities and proposes new or modified priorities for European Central Bank banking supervision.
This document was prepared by the Economic Governance Support Unit at the request of the ECON Committee.
Related content
The Listing Act: no more than a minor boost to EU equity markets
Streamlining of the company listing process is welcome, but more fundamental reform is needed to revive the European Union’s flagging equity markets.
The potential of sovereign sustainability-linked bonds in the drive for net-zero
Sovereign SLBs could help incentivise climate policies in EU countries, and accelerate emission reductions.
Volatile energy markets expose the fragility of Europe’s capital market infrastructure
Reform of the EU central clearing framework is an essential part of capital markets union, but reform should not be driven by current energy turmoil.
What can central banks do to take the Paris Agreement seriously?
Central banks should take a macro approach to managing system-wide risks stemming from the climate transition