The twelve areas where supervised banks face challenges, as identified by the ECB, are:
- geopolitical uncertainties;
- the stock of non-performing loans (NPLs) and potential for a build-up of future NPLs;
- cybercrime and IT disruptions;
- potential repricing in financial markets;
- the low interest rate environment;
- banks’ reaction to new and existing regulations;
- euro area economic and fiscal conditions;
- cases of misconduct;
- developments in real estate markets;
- structural business challenges;
- non-bank competition; and
- climate-related risks.
The priority areas for supervision in 2019 build on the assessment of these twelve sources of banking risk. By focusing supervisory efforts, the ECB aims to ensure that banks effectively address such risks. As was the case for 2018, full implementation of the various activities planned for 2019 may take more than one year.
In a separate development, the European Supervisory Authorities (ESAs) have also recently published their annual work programmes for 2019:
- the Joint Committee of the ESAs 2019 Work Programme;
- the European Banking Authority (EBA) 2019 Work Programme;
- the European Securities and Markets Authority (ESMA) 2019 Annual Work Programme; and
- the European Insurance and Occupational Pensions Authority (EIOPA) Single Programming Document 2019-2021 with Annual Work Programme 2019.