ECB Says Banks Need to Improve Trading Client Risk Controls
- Elizabeth McCaul sees major shortcomings at some lenders
- Counterparty risks to banks are in focus after Archegos blowup
Elizabeth McCaul speaks during the 2023 European Central Bank Forum on Banking Supervision.
Photographer: Adrian Petty/ECBThis article is for subscribers only.
European banks need to improve their ability to manage the risks they face in dealing with clients such as hedge funds, according to a top regulatory official.
“There are some banks where we see major deficiencies, we don’t see remediation, we don’t see appropriate follow-through,” Elizabeth McCaul, a member of the European Central Bank’s Supervisory Board, said in a speech Wednesday. “Also in general when I look at the whole portfolio across the board, there are still a few major areas, even the banks that are conducting remediation, where we do feel the banks need to step up their work in this area.”