CySEC Adopts New European Guidelines For Cloud Outsourcing And Updates Stress Test Protocols

by THEFUTURE.TEAM

March 17, 2026

The Cyprus Securities and Exchange Commission (CySEC) has taken a significant stride toward strengthening regulatory frameworks in the financial sector by implementing the latest European guidelines on cloud outsourcing. In tandem, the commission has issued an advisory regarding enhanced stress test rules for money market funds, signifying a commitment to bolstering both digital operational resilience and market stability.

Cloud Outsourcing Within Regulatory Framework

CySEC has adopted the latest European standards for outsourcing to cloud service providers, targeting select depositaries responsible for safeguarding alternative investment funds and collective investment schemes (UCITS). These guidelines are pivotal for entities that do not fall under the purview of the Digital Operational Resilience Act (DORA), ensuring that supervisory practices remain robust across the board.

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Refined Scope Under Digital Operational Resilience

The evolution of the DORA regulation, which now governs digital operational resilience for the majority of financial entities within the European Union, prompted CySEC to revise the scope of its cloud outsourcing guidelines. The updated rules ensure that only the remaining depositaries not covered by DORA adhere to these specific standards, thereby maintaining regulatory relevance without duplicating oversight.

Guidelines To Navigate Cloud Outsourcing Risks

Developed under the auspices of the European Securities and Markets Authority (ESMA), the framework comprises nine detailed guidelines. These directives are designed to assist both regulators and financial entities in identifying, managing, and mitigating risks associated with cloud outsourcing. Key focus areas include the decision to migrate services to the cloud, provider selection, ongoing monitoring, and the establishment of robust exit strategies.

Enhanced Stress Test Protocols For Greater Market Stability

In a parallel move, CySEC has reaffirmed updated European guidelines concerning stress test scenarios for money market funds. Addressed primarily to managers of alternative investment funds and management companies under CySEC’s supervision, these guidelines establish common reference points for assessing the ability of funds to withstand market shocks. This uniform approach is intended to enhance risk assessment practices and fortify the resilience of the sector against potential market disruptions.

Compliance And Future Outlook

The revised cloud outsourcing guidelines and updated stress test parameters underscore a broader regulatory initiative to adapt to rapid digital innovation while maintaining rigorous supervisory standards. As these guidelines are now fully operative following their publication in all European Union languages, CySEC urges all relevant entities to ensure full compliance. The measures not only streamline the supervisory process but also provide a clear roadmap for the financial sector to navigate both technological advancements and market challenges effectively.

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Bank of Cyprus Upgrade Signals Fresh Optimism For Greek And Cypriot Banks

by THEFUTURE.TEAM

June 26, 2026

Regional Banks Enter A More Favorable Cycle

Bank of Cyprus and Eurobank are well positioned to benefit from a renewed re-rating of Greek and Cypriot bank stocks, according to Cyprus-based investment firm Roemer Capital, which upgraded Bank of Cyprus to a buy rating and reaffirmed its positive view on Eurobank.

The firm cited easing geopolitical tensions, resilient economic growth in Greece and Cyprus, lower funding costs and Greece’s expected transition to developed-market status as the main factors supporting the sector.

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Roemer Capital also lowered its cost of equity assumptions, updated its forecasts following first-quarter 2026 results and extended its valuation horizon to the end of 2027, raising target prices across its banking coverage.

Bank Of Cyprus Gets The Largest Upgrade

Bank of Cyprus received the biggest revision, with Roemer Capital upgrading the stock from hold to buy and setting a target price of €11.10, implying potential total upside of 27%.

The firm highlighted the bank’s strong capital generation, profitability and projected 100% dividend payout, describing it as the strongest capital-return story among the banks under coverage. Roemer Capital maintained its buy rating on Eurobank, assigning a target price of €4.90 and forecasting potential upside of 28%. The report said the bank is well placed to benefit from loan growth, improving operating performance and merger-and-acquisition synergies.

National Bank of Greece and Piraeus Bank also retained buy ratings, with expected returns ranging from 25% to 36%. Optima Bank was upgraded to buy, while Alpha Bank remained at hold on valuation grounds.

Why Growth Still Sets The Region Apart

According to Roemer Capital, Greek and Cypriot banks continue to benefit from stronger economic fundamentals than many western European peers. The report pointed to faster economic growth, healthier balance sheets, low levels of non-performing exposures, capital ratios approaching 20% and strong customer deposit bases.

Analysts expect performing loans across the sector to grow at a compound annual rate of 6% to 8% through 2028, supported by private investment, digitalisation, green manufacturing, supply-chain expansion and a gradual recovery in household lending.

The report also said the conclusion of lending under the EU Recovery and Resilience Facility is unlikely to materially affect credit growth, as banks have already shifted back towards traditional commercial lending. Roemer Capital expects Euribor to remain between 2.2% and 2.5%, a level it believes should support both lending activity and net interest margins.

Geopolitics, Valuation And Market Structure Support The Case

The report said improving geopolitical conditions have strengthened the investment outlook, noting that Brent crude prices have largely returned to pre-war levels while Greek government bond yields have stabilised at around 3.5%. Although geopolitical risks remain, Roemer Capital believes the likelihood of a major inflationary shock or significant pressure on bank profitability has eased.

Another important catalyst identified by the firm is Greece’s expected promotion to developed-market status by FTSE Russell, STOXX and MSCI over the coming months.

According to the report, the reclassification should improve liquidity and attract a broader base of international investors. Roemer Capital also said Euronext’s acquisition of the Athens Exchange is expected to strengthen market infrastructure and increase international visibility, particularly for Bank of Cyprus and Optima Bank.

The firm noted that Bank of Cyprus has already benefited from its Athens listing, with average daily trading value increasing from less than €400,000 before its September 2024 move to nearly €6 million afterwards.

Economic Momentum Remains A Core Tailwind

Roemer Capital said both Greece and Cyprus have moved beyond post-crisis recovery and are now supported by private-sector-led growth. For Cyprus, the report highlighted recent tax reform and efforts to simplify the legal and regulatory framework, while also noting that limited foreign banking competition continues to support domestic lenders.

Overall, Roemer Capital expects Greek and Cypriot banks to remain well-positioned for profitable loan growth over the coming years.

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