ECB official urges banks to prepare for risks their models cannot capture
In an October 14 speech, ECB Executive Board member Frank Elderson called for broader bank resilience planning as climate, nature and other risks become harder to model.
What the record says
Speaking at an ECB–Bank of England conference, Elderson said scenario analysis should be challenged and supplemented with expert judgment. He argued that preparedness also requires capital, liquidity, operational capacity and flexible decision-making, including for risks that historical data cannot reliably quantify.
Source details and supporting locations.
Practical next step
Read the official speech and applicable supervisory materials for the distinction between risk analysis and binding requirements.
Limits and what is not established
These are a named official’s supervisory remarks, not a newly announced interest-rate decision or a new capital rule. Scenarios describe possible futures rather than forecasts.
Sources checked October 16, 2026. Later notices may change instructions or arrangements.
Original sources
European Central Bank: original information