EBA publishes 2024 annual report on supervisory convergence

The European Banking Authority (EBA) has released its 2024 annual report on the convergence of supervisory practices across the EU. The report outlines the EBA's ongoing efforts to strengthen the alignment of supervisory approaches across Member States and across key areas of its activities, including prudential, resolution, digital finance, consumer protection and until the end of this year anti-money laundering/counter-terrorist financing (AML/CFT). In the area of prudential regulation, the report reflects on findings from its 2024 European Supervisory Examination Programme focused on liquidity and funding risk, interest rate risk and hedging, and recovery operationalisation. The report notes that risk levels in these areas remain stable, though challenges persist around data quality, stress testing scenarios and modelling assumptions. The EBA will continue monitoring risks related to online deposit platforms and compliance with Supervisory Outlier Tests in 2025.

In relation to resolution and crisis management, the report highlights improved coordination and that significant progress has been made in operationalising resolution bail-in tools, particularly the bail-in mechanism in cross-border contexts. On digital finance, the EBA focused on preparing for the implementation of the Markets in Crypto-Assets Regulation, particularly on the supervision of asset-reference token and e-money token issuers. It also supported convergence through an EU-wide supervisory handbook and coordinated workshops. In the area of consumer protection and AML/CFT, the report notes enhanced cooperation and risk-based supervision among national authorities, with the EBA now preparing for the transition of its supervisory responsibilities to the new EU Anti-Money Laundering Authority at the end of 2025. The EBA states that this is a key step towards it implementing the recommendation from its earlier report on the efficiency of the regulatory and supervisory framework that it should provide a more detailed account of supervisory convergence in the EU.

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