The banking sector plays a crucial role in helping Europe achieve its goals of economic growth, innovation, and competitiveness, but appropriate measures must be taken to enable it to fully harness its financing capacity.

This is according to a report by the Spanish Banking Association (AEB), CECA, and the National Union of Credit Cooperatives (Unacc), prepared in collaboration with EY, which estimates that, through regulatory and supervisory simplification and greater integration of financial markets, the sector could increase its lending capacity by more than 2 trillion euros, of which 250,000 million would correspond to Spain.

La entrada A Stronger, More Integrated Banking Sector for Growth se publicó primero en Asociación Española de Banca.

“The banking sector is using AI to better understand its customers, better protect them, and offer them higher-value services—always with a human in the process,” he said at the APIE course, where he noted that the banking sector is, by definition, innovative, with ongoing investment in technology, data, digital talent, and cybersecurity.

Kindelán noted that artificial intelligence “is already a reality in banking.” More than 95% of European financial institutions are already using it in various applications or pilot projects, and in Spain, its integration is particularly advanced due to the sector’s high level of digitization.

AI is already helping to transform banking in three main areas. The first is customer relations, because it makes it possible to offer more personalized, tailored, and responsive services and to better understand customers’ needs.

The second is internal processes. Automation makes it possible to improve efficiency, reduce costs, and devote more resources to tasks with higher added value. And the third is risk and security management. Artificial intelligence helps detect fraud, anticipate risks, and improve creditworthiness analysis, which strengthens the sector’s ability to protect itself and contributes to stability.

Kindelán also noted that new AI models increase the scale, speed, and sophistication of risks, but they also strengthen defensive capabilities. Banks are already using this technology in their systems to detect anomalous patterns, anticipate attacks, and better protect customers.

“Artificial intelligence is a game-changer. But one thing remains the same: in banking, trust is still the most important asset,” Kindelán said. The Spanish banking sector wants to be part of this transformation, with innovation, security, and trust as its hallmarks.

In Spain, these efforts have resulted in one of the most advanced banking systems in terms of digitalization and technological infrastructure. All of this has been achieved without losing the essence of a customer-focused banking system, with a physical presence that remains important to many customers.

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This is according to a report by the Spanish Banking Association (AEB), CECA, and the National Union of Credit Cooperatives (Unacc), prepared in collaboration with EY, which estimates that, through regulatory and supervisory simplification and greater integration of financial markets, the sector could increase its lending capacity by more than 2 trillion euros, of which 250,000 million would correspond to Spain.

This increased financial capacity will drive investment in areas critical to strategic sovereignty. In the fields of digitalization, cybersecurity, and artificial intelligence alone, investment could reach 12,000 millones de euros annually in Europe and 1,200 millones in Spain.

Given that the banking sector already accounts for nearly 80% of business financing in Europe, the goal is not to deregulate or lower the requirements that underpin financial stability. The goal is to build a stable framework to expand the capacity to finance households and businesses and to support investments that strengthen Europe’s position in the new international context.

To this end, the following measures are proposed:

1. Inclusion of an explicit objective of competitiveness and growth within the mandate of regulatory and supervisory authorities.
2. Simplification of the capital framework through a comprehensive view of the overlaps.
3. Simplifying the supervisory framework to make it more efficient and focused on material risks.
4. Simplification of the European regulatory process, including a shift toward a regulatory framework based more on regulations and less on directives.
5. Completion of financial integration, including the establishment of the Banking Union with a single deposit insurance fund (EDIS) and the development of the Capital Markets Union.
6. Effective application of the principle of proportionality and supervision that focuses on material risks and is tailored to the size, complexity, and business model of each institution.
7. Simplification of regulatory reporting, including ESG reporting.
8. Establishment of a more proportionate and coherent digital regulatory framework.
9. The framework’s neutrality with respect to the various national models of corporate governance.

Given that financing needs in the eurozone exceed 1.2 trillion euros annually, it is urgent to boost the banking sector’s competitiveness through these measures, so that the sector can more effectively fulfill its role in supporting the economy.

La entrada A Stronger, More Integrated Banking Sector to Drive Growth se publicó primero en Asociación Española de Banca.

This is reflected in the estimates contained in a report prepared by the AEB, CECA, and Unacc, in collaboration with EY, which authorities and industry representatives presented during the conference “Competitiveness for Growth: The Role of the Banking Sector,” organized by the three associations.

“Europe has all the economic and social potential to be a global model of progress, innovation, and well-being. That is why this competitiveness agenda requires courage and political determination,” Alejandra Kindelán said during her speech.

“This is not merely a technical issue; it is a strategic decision. Europe’s economic strength in the coming years depends on how and how urgently we resolve this,” he added.

During the meeting, the experts outlined the main conclusions of the report, which proposes a series of measures to create a more competitive banking sector. These include simplifying the capital framework and completing European financial integration by finalizing the Banking Union and developing an effective Capital Markets Union. It also calls for the inclusion of an explicit objective to promote banking competitiveness and economic growth as a secondary objective for regulators and supervisors.

In addition to the significant impact on credit capacity, implementing these proposals would boost the eurozone’s GDP by 2.7%, which would be three times the average over the past two decades. Experts also estimate that 2 million jobs would be created, including 300,000 in Spain.

“We don’t have much time to waste; we have assessments, analyses, and, most importantly, broad consensus. It’s time for action because, moreover, there is an international context in which other jurisdictions are already ahead of us,” Kindelán noted.

“We need to review the regulatory framework and make regulations more predictable and stable,” added CECA Director General Antonio Romero. For his part, Unacc President Manuel Ruiz Escudero noted that “in an increasingly demanding financial environment, proportionality is not an option, but an urgent necessity.”

Representatives of the banking sector have made it clear that simplification does not mean deregulation, but rather making the system more efficient so that banks can expand their financing capacity in the face of investment needs totaling 1.4 trillion euros annually.

Also participating in the event were José Luis Escrivá, governor of the Bank of Spain; Carlos Cuerpo, first vice president and minister of Economy, Trade, and Business; Carlos Torres Vila, chairman of BBVA; Héctor Grisi, CEO of Banco Santander; Gonzalo Gortázar, CEO of CaixaBank; Frank Elderson, Vice Chair of the ECB’s Supervisory Board; Fernando Restoy, President of the BIS Financial Stability Institute; and José Manuel Campa, former Chair of the European Banking Authority (EBA).

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“Tokenization and distributed ledger technology (DLT) can help modernize financial markets, reduce inefficiencies, and strengthen integration, liquidity, and European competitiveness,” he stated at the conference on digitalization and innovation in payments organized by the ECB and opened by its president, Christine Lagarde.

During her remarks, María Abascal emphasized that tokenization represents a strategic opportunity for Europe, not only from a technological standpoint, but also to address market fragmentation, improve capital allocation, and strengthen Europe’s ability to finance its strategic priorities.

He also noted that the main obstacle to moving this process forward is not technology, but funding, and he argued for the need to combine tokenized deposits and central bank money within DLT infrastructure to ensure secure and scalable settlements.

In this context, it has opted for a hybrid ecosystem in which public and private solutions coexist, with tokenized deposits serving as a natural evolution, central bank money on DLT acting as an anchor of stability, and stablecoins playing a complementary role in specific applications.

Abascal also warned that, without interoperability, common standards, and coordination, Europe risks replicating in its new digital infrastructure the inefficiencies resulting from the fragmentation that already exists in the current system.

For this reason, he has advocated for regulatory adjustments that prevent a loss of competitiveness (MiCA, DLT Pilot), a cash settlement infrastructure at the ECB, and an active role for the central bank as coordinator of the ecosystem, with the aim of moving from pilot projects to full-scale implementation and building an integrated, competitive system based on the euro.

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During the closing ceremony of the 10th ICO Sustainable Bonds Forum, Kindelán highlighted the enormous challenges Europe faces in addressing the new needs associated with the green and digital transitions. “Today, the sustainability agenda is a driver of transformation,” he said.

Given the scale of these projects, the president of the AEB noted that sustainable bonds are essential for channeling long-term savings into these projects, which must also be profitable. In this regard, she highlighted the importance of public-private partnerships, in which the ICO plays a key role in complementing the private sector through its guarantee schemes and the ability to leverage the banking network’s reach.

“To promote sustainable investment, public authorities must provide appropriate incentives and ensure that objectives and policies remain predictable and stable over time,” Kindelán added.

The president of the AEB has emphasized the banks’ commitment, noting that new lending for sustainable activities in Spain exceeded 90 billion euros last year. But expectations for the coming years are even higher.

For this reason, and to ensure that the banking sector can maintain momentum on these projects, a stable, integrated, and predictable regulatory environment is needed. On the subject of sustainability, Kindelán noted that progress has already been made through initiatives such as the first Omnibus simplification package, the reform of the CSRD, and that of the CS3D, which have helped reduce administrative burdens, particularly for SMEs.

“We now hope that supervisors will adjust their expectations to this new simplified framework,” he said during the meeting, which was also attended by ICO President Manuel Illueca and Carla Díaz de Toledo, Director General of the Treasury and Financial Policy, among others.

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During the inauguration of the conference ‘Financing defense: regulatory aspects and compliance’, organized by the Ministry of Economy, Trade and Enterprise, together with the AEB, Kindelán reiterated the commitment of banks to this type of security-critical projects, which have also become a priority for institutions such as the European Council or the European Parliament.

The president of the AEB explained, however, that the reinforcement of defense capabilities by states requires a change of approach. “It is not just a matter of investing more, but of investing better, investing together and doing so on a European scale,” she said.

In his speech, Kindelán pointed out that defense spending could double in the coming years. For this reason, he defends the key role of banking at a time when private financing, together with public investment, are the only ones that can assume these new needs. “The banking sector is willing and able to assume this role, but it needs a regulatory and supervisory framework adapted to the new context, with predictability in capital requirements,” he said.

The need for an adequate framework to respond to the challenges in the area of security, through three channels, has been analyzed in these conferences, in which Julián Conthe, General Director of Trade Policy and Economic Security, Rafael Coloma, Deputy General Director of International Trade of Defense and Dual-use Material, and Manuel Illueca, President of the Official Credit Institute (ICO), among others, have participated.

On the one hand, with adequate export control legislation, since defense and dual-use material continues to be the only area where export licenses are required. On the other hand, with the prevention of illicit activities. And finally, with the role of the ICO and the promotion of instruments that strengthen the financing capacity of companies in the sector.

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European banks currently cover more than 70% of Europe’s financing needs, making their role more relevant than ever to strengthen the competitiveness of these investment-intensive projects.

Institutions reach this crucial moment in a position of strength. But in order to unfold their full potential and expand their financing capacity, it is necessary to make progress in regulatory and supervisory simplification. Also in market integration, to facilitate the channeling of savings towards productive investment.

This was reflected in the event held in Brussels to present the document, which was attended, among others, by the director general of the AEB, María Abascal, and the former Italian prime minister, Enrico Letta. “If regulation and supervision are the medicine to safeguard the health of the European financial system, determining and adjusting the right dosage is essential to enable the sector to significantly increase its contribution to growth,” the EBF has assured.

In this new report, Oliver Wyman provides an updated assessment with a breakdown of additional investment needs in Europe, as well as an analysis of the capacity of European banks to finance them and the mechanisms that could enable them to play a greater role in boosting growth and competitiveness.

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AEB institutions and their foundations allocated a total of 1,972 million euros to social action in 2025, reaching 15.9 million beneficiaries. This is highlighted in a report prepared in collaboration with EY, which shows how social vocation is part of the raison d’être of credit institutions.

Beyond the volume of funding for this type of initiative, the study shows how they generate opportunities, inclusion, support and a radical change in the lives of the beneficiaries, with very positive impacts on 2.1 million women at risk of exclusion, 900,000 young people, 1.5 million social entrepreneurs, 1.3 million elderly people and 13,000 people with disabilities, among others.

The lines of action include those aimed at promoting financial education, employment and entrepreneurship, social inclusion, culture and research, scholarships and support for vulnerable groups.

The results of the report reflect a social action that combines interventions of different nature, adapting to different needs and contexts, and contributing in a complementary way to the generation of social value.

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During the conference ‘Why do we want a digital euro?’ of the Elcano Royal Institute on the transformation of money, Kindelán explained that the objective is for Europe to have its own alternatives to the large international card schemes.

In this regard, he highlighted the work done by banks to promote private European digital payment solutions, giving as an example the case of Bizum, created by Spanish banks in 2016 and currently used by more than 31 million citizens.

Bizum is already interoperable with the equivalent systems in Italy and Portugal, allowing instant payments between users in these countries without the need to use separate applications.

This interoperability will be extended and, expected between the end of 2026 and the beginning of 2027, will allow users to make instant payments with Germany, Belgium, Holland, France and Nordic countries, reaching a potential market of 135 million users in 13 European countries.

In addition, Kindelán emphasized that Bizum will continue to expand its e-commerce and physical merchant payment functionalities across Europe, thus reinforcing the existence of a European digital payments infrastructure of its own.

Euro digital wholesale

Regarding the digital euro, Kindelán defended the need to urgently advance in the development of the wholesale digital euro, oriented to operations between financial institutions and markets, an area in which he considered that there are clear opportunities to improve efficiency and competitiveness for Europe.

The digital euro, said the president of the AEB, should act as a complementary solution within the payments ecosystem, coexisting with existing private initiatives.

In addition, he highlighted its usefulness for offline payments, allowing digital money transfers even without an internet connection, similar to the current use of cash.

The president explained that the banking sector is actively participating in the working groups promoted by the European Central Bank to design the future digital euro and that it fully shares the objectives of the project: to strengthen European strategic autonomy, improve the efficiency of payments and complete the integration of the European digital payments ecosystem.

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