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EBA Unveils 2024 Report to Strengthen Supervisory Convergence Across the EU

by THEFUTURE.TEAM

October 27, 2025

Overview

The European Banking Authority’s 2024 annual report details a comprehensive effort to harmonize supervisory practices across the European Union. The report outlines strategic initiatives across prudential supervision, resolution and crisis management, digital finance, consumer protection, and the interim AML/CFT framework until the end of 2025. This marks a decisive step in implementing further recommendations from the EBA’s evaluation of regulatory efficiency.

Consolidating Prudential Supervision

The EBA’s European Supervisory Examination Programme for 2024 focused on critical areas such as liquidity and funding risk, interest rate risk, and the operationalization of recovery measures. With risk levels remaining stable amidst ongoing challenges in data quality, stress testing, and modelling assumptions, the EBA is set to intensify its monitoring activities for online deposit platforms and oversee compliance with Supervisory Outlier Tests in 2025.

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Advances in Resolution And Crisis Management

In the realm of resolution, the report highlights significant progress in operationalizing resolution tools, notably the bail-in mechanism in cross-border environments. Improved coordination among authorities, enhanced management information systems, and persistent efforts to refine data quality and legal recognition issues underpin this advancement.

Strategic Developments in Digital Finance

With digital finance at the forefront, the EBA has prioritized its preparations for the implementation of the EU’s Markets in Crypto-Assets Regulation. Efforts include the supervision of asset reference tokens and e-money token issuers, the development of an EU-wide supervisory handbook, and the coordination of workshops aimed at establishing a unified supervisory approach from the outset.

Enhancing Consumer Protection And AML/CFT Measures

The report also underscores improved cooperation and risk-based supervision among national authorities in consumer protection and AML/CFT. Notable progress has been achieved through AML/CFT college monitoring and implementation reviews, as the EBA prepares for the eventual transfer of AML/CFT supervisory responsibilities to the new EU Anti-Money Laundering Authority by the close of 2025.

Fostering A Common Supervisory Culture

Beyond sector-specific improvements, the EBA continues to champion supervisory convergence through robust cross-border initiatives including peer reviews, Q&A sessions, breach of Union law investigations, and comprehensive training programmes. In 2024 alone, 23 courses were delivered to over 3,000 participants, reinforcing best practices and aligning supervisory standards throughout the EU.

Future Trajectory

Looking ahead, the EBA is set to place greater emphasis on the effective implementation of the Single Rulebook. This strategic pivot will enhance supervisory outcomes and ensure the consistent application of regulatory measures, as reflected in the annual reports to the European Parliament and the Council under the Supervisory Review and Evaluation Process.

With these measures, the EBA reaffirms its commitment to building a unified and resilient supervisory framework, essential for navigating the complex regulatory landscape of the European financial sector.

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Cyprus Banks Urged To Focus On Long-Term Resilience As Profits Remain Strong

The Cypriot banking sector remains in a strong position, supported by solid capital buffers and overall financial stability, according to speakers at the annual general meeting of the Association of Cyprus Banks. At the same time, government officials and regulators stressed that maintaining this position will require continued discipline and long-term planning.

A Strong Sector, But Not A Complacent One

Finance Minister Makis Keravnos used the meeting to highlight concerns over draft laws recently passed by parliament, which, according to the Ministry of Finance, the Central Bank and the Legal Service, may contain constitutional, legal and institutional issues. Those concerns, he noted, led to presidential referrals and remittals to the Supreme Court.

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Keravnos also said the European Central Bank had been consulted on proposed measures concerning the suspension of foreclosures and the restructuring of loans and guarantees, adding that the ECB had expressed its own concerns.

Profitability Should Reflect Real Economy Lending

While acknowledging that the banking sector remains highly profitable, Keravnos said earnings are expected to reach around €1 billion in 2025, lower than in 2024 as interest-rate conditions gradually normalize.

He said he would prefer bank profitability to rely more on lending to businesses operating in productive sectors and less on the widening of European Central Bank interest-rate spreads.

According to the minister, Cyprus’ return to investment-grade status after 11 years has strengthened the country’s appeal to foreign investors, technology companies and startups. He said this should encourage banks to offer financing that better supports businesses while improving the diversification of their loan portfolios.

The Central Bank’s Warning: Strength Today Is Not A Guarantee Tomorrow

Central Bank Governor Christodoulos Patsalides also warned against complacency, saying the sector’s current strength should not be taken for granted.

“The Cypriot banking sector is strong today. But strength that truly matters is not exhausted by a capital ratio, a profit line or a favorable cycle,” he said.

Patsalides added that lasting resilience depends on institutions remaining strong as conditions change, risks become more complex, and competition evolves. In his view, that requires sufficient capital buffers, adaptable infrastructure and management teams prepared for changing market conditions.

Long-Term Resilience Over Short-Term Gains

Patsalides also stressed that banks should focus on long-term resilience rather than short-term performance. Decisions on dividend policy, capital allocation and the use of resources, he said, should take into account continued investment in technology, operational resilience, human capital and long-term adaptability.

He added that banks able to remain competitive over time will be those that invest early in strengthening their capacity to adapt and respond to future challenges.