The Bank of Spain published Deputy Governor Soledad Núñez’s appearance before the Congress of Deputies on the economic and social challenges facing Spain’s banking sector. She characterised Spanish banks as entering a more uncertain global environment from a solid starting point, while calling for a drive to reduce regulatory and supervisory complexity without weakening standards, and for continued focus on digital resilience, emerging technologies, the digital euro, green transition finance, and financial inclusion and literacy. In her remarks, Núñez highlighted historically low non-performing loan ratios (3.21%) and comparatively strong profitability for significant institutions (14.2% versus a Single Supervisory Mechanism average of 9.45%), alongside the scale of euro area banking supervision (almost EUR 27 trillion of supervised assets across 109 banks). On regulation and supervision, she argued for a holistic review of level 2 and level 3 rules to identify overlaps or clashes across microprudential, macroprudential and resolution frameworks, and noted parallel work to make supervisory processes more agile while preserving clarity, predictability and proportionality. On technology, she framed the Digital Operational Resilience Act as central to managing ICT and cyber risks, including testing and work with technology providers, and discussed artificial intelligence as both a cost and risk-management enabler and a source of risks such as model opacity, data protection issues and algorithmic herding. She also linked the case for a digital euro to Europe’s reliance on non-European payment networks (72% of card transactions) and to concerns about dollar-denominated stablecoins, while noting that the final decision rests with European legislators. On social and environmental issues, she stressed the need for stable sustainability rules and cautioned that any simplification of corporate reporting should not remove harmonised disclosure of critical climate and nature risk data; she also pointed to access gaps arising from branch closures and digitalisation, and stated that the Bank of Spain is redoubling conduct supervision through a new approach and will bolster resources aimed at supporting financial literacy.
Bank of Spain 2025-06-05
Bank of Spain deputy governor urges simplification of banking regulation and highlights DORA, digital euro and inclusion risks to parliament
The Bank of Spain's Deputy Governor Soledad Núñez addressed Congress on challenges in Spain’s banking sector, emphasizing simplifying regulations while maintaining standards. Núñez highlighted the sector's strong position, low non-performing loan ratios, profitability, and stressed digital resilience, the digital euro, and sustainable finance. She discussed the Digital Operational Resilience Act, AI risks, and the need for stable sustainability rules and improved financial literacy.