Martin Neisen: The emerging regulatory landscape for 2025 and the framework for the future of banks in Europe

Martin Neisen, Partner-FS Governance, Risk and Compliance and Head of the EBA/SSM Office at PwC Germany, presented the key developments in the Eurozone's regulatory environment, outlining the framework for the future of banking in Europe at the 12th Banking Forum & FinTech EXPO being held on 16 January in Nicosia.

He highlighted the 10-year anniversary of the establishment of the Single Supervisory Mechanism (SSM), which he said has transformed the supervision of banks in the Eurozone. Neisen emphasised that despite the challenges faced by the industry, the SSM has contributed significantly to ensuring stability and transparency in the banking system.

He analysed the findings of the 2024 Supervisory Review and Evaluation Process (SREP). As the banking sector concludes another challenging year, he pointed out that prolonged uncertainty around macroeconomic prospects, combined with escalating geopolitical tensions, creates significant risks for European banks. He noted that these risks are closely monitored by supervisory authorities, such as the European Central Bank (ECB).

His presentation focused on key regulatory trends, including the implementation of CRR III, the use of artificial intelligence (AI), and requirements related to ESG (Environmental, Social, and Governance) criteria.

Neisen discussed the impact of risk-weighted assets (RWA) and the importance of an evolving regulatory framework that must consider the broader macroeconomic environment, explaining how this affects banks and their operations.

Finally, he outlined the ECB's priorities for the coming years, emphasising the changes expected to shape the banking landscape in the Eurozone. He underscored the importance of flexibility and adaptability in an ever-changing world, where supervisory authorities and banks must collaborate to ensure the sustainability and stability of the financial system.

Martin Neisen oversees the Governance, Risk, and Compliance (GRC) practice at PwC Germany, which includes a team of 500 professionals focused on GRC matters for banks, insurance companies, and asset managers. With over 20 years of experience in the financial services industry, he is regarded as an authority in regulatory compliance, risk management, and the implementation of global standards such as Basel IV. He also leads the SSM Office within PwC, coordinating collaboration with SSM-supervised banks across the Eurozone.