Frank Elderson of the ECB emphasizes the importance of operational resilience in banks amid increasing cyber threats and AI-driven risks, highlighting recent initiatives and the need for proactive investment.
Frank Elderson, Member of the Executive Board of the ECB and Vice-Chair of the Supervisory Board, delivered a keynote at the Goldman Sachs European Financials Conference 2026.
He highlighted that Europe faces unprecedented challenges, including geopolitical fragmentation and dependency on external providers for energy, technology, security, and financial infrastructure. Reducing these dependencies is essential for safeguarding the European way of life.
Investment needs for green, digital, and defense transitions are estimated at an additional €1.2 trillion annually until 2031. Private investment and capital markets are crucial to meet these challenges.
Strong, resilient banks are vital in a bank-based financial system to sustain finance flow to the economy. Resilience extends beyond capital, especially in the face of cyber threats, technology failures, and dependencies on third parties.
Examples such as the 2023 ransomware attack on ICBC’s New York branch and the 2024 CrowdStrike incident demonstrate that financial strength alone does not ensure operational continuity. The rise of AI introduces new cyber risks, including AI-generated identities and advanced attack tools, which lower the barriers for malicious actors.
Operational resilience is a strategic, firm-wide issue. Banks and supervisors have made progress through capacity building, governance improvements, and regulatory frameworks like the Digital Operational Resilience Act (DORA). Stress tests and oversight aim to strengthen cyber defenses.
AI’s rapid adoption among banks (over 85%) offers benefits but also amplifies cyber risks. Advanced AI models can discover vulnerabilities faster, combine minor flaws into major attacks, and reverse-engineer patches, increasing the threat landscape.
Management bodies must take ownership of cyber resilience, ensuring resources and oversight are adequate. The ECB will issue a “dear CEO” letter to prompt proactive measures and will follow up with individual banks.
Operational resilience is integral to banks’ competitiveness. It requires multi-year investments in people, systems, and governance. All banks, regardless of size, must ensure sufficient resilience to support the economy and meet future challenges.
In conclusion, Europe’s financing needs for transition and defense require strong, resilient banks. The evolving AI-driven cyber threats demand urgent, proactive action to maintain operational continuity and trust in the banking system.
