FRANKFURT, Sept 2 (Reuters) - Euro zone banks should factor in geopolitical risks when they decide how much capital to pay out and where to do business, the European Central Bank's top supervisor Claudia Buch said on Monday.

"Geopolitical events ...transmit into increased credit, liquidity, market, and operational risks, for example by disrupting value chains or third-party service provision," Buch told European lawmakers.

"Banks must therefore use scenario analyses and factor uncertainties into their capital planning. They may also need to reassess their geographical exposures and outsourcing strategies."

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https://www.reuters.com/markets/europe/euro-zone-banks-must-consider-geopolitics-capital-plans-ecb-2024-09-02/