On 17 December 2024, the European Central Bank (ECB) published the results of its Supervisory Review and Evaluation Process (SREP) for 2024 and its Supervisory Priorities 2025-27.

The key message from the SREP 2024 is that the euro area banking sector remained resilient in 2024. On average, banks maintained solid capital and liquidity positions, well above regulatory requirements. The aggregate Common Equity Tier 1 (CET1) ratio stood at 15.8% in mid-2024, which is a slight improvement compared with the previous year. The leverage ratio increased slightly to 5.8%. Higher interest rates continued to sustain banks’ profitability.

The ECB’s Supervisory Priorities largely continue to build upon those set last year and focus on making banks more resilient to immediate macro-financial threats and severe geopolitical shocks (priority 1); ensuring banks remediate known material shortcomings in a timely manner (priority 2); and ensuring banks tackle challenges stemming from digital transformation and new technologies, prudently managing the associated risks (priority 3).