The EBA sets EU-wide examination programme priorities for prudential supervisors for 2024

The European Banking Authority (EBA) today published the European Supervisory Examination Programme (ESEP) for 2024, which identifies key topics for heightened supervisory attention across the European Union. The ESEP is aimed at driving supervisory convergence by providing Competent Authorities with a single set of priorities for implementation in 2024.

The EBA selected the following three key topics for supervisory attention for 2024 on the basis of its EU-wide risk analysis, its relevant policy work and the practical experience of competent authorities:

• liquidity and funding risk
• interest rate risk and hedging
• recovery operationalisation

The choice of such topics was supported by structural changes, such as i) the end of the abudant liqudity in the system; ii) the increased interest rate environment; iii) the implementation of the IRRBB package in the EU; iv) lessons learned from the spring bank failures, v) energy and food markets volatility. These topics target aspects that are considered ‘specific’ for the upcoming year compared to the ‘business as usual’.

The specific supervisory attention to these areas will contribute to ensuring the financial resilience of EU institutions, and will ultimately lead to a higher level of supervisory convergence across the EU, also through the implementation of the related policy products.

The EBA will follow up on how these key topics are embedded in competent authorities’ priorities for 2024, and how they form part of their supervisory activities throughout the year. The observations collected will feed into the overall conclusions on the degree of convergence of supervisory practices. 

Note to the editors

The ESEP is one of the key elements of the EBA`s supervisory convergence toolkit which aims at delivering the EBA`s supervisory convergence mandate as required by the EBA`s founding regulation and by Article 107 of the CRD specifically in the context of the supervisory review. The 2024 ESEP complements competent authorities` core prudential supervisory activities and does not aim to provide an overarching and comprehensive supervisory examination programme, as that should be developed by competent authorities taking into account the ESEP, the structure and specific vulnerabilities of the banking system under their remit and the idiosyncratic dimensions of the individual bank or banking group they supervise.

With a view to fostering greater convergence of resolution practices, the EBA also sets priorities for resolution authorities in its annual European Resolution Examination Program (EREP). The 2024 priorities were published as part of the EBA’s latest Resolution Convergence report.