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On 6 May the European Commission published the 2026 European financial stability and integration review (EFSIR). The report was presented at the 2026 European financial integration conference, organised jointly with the European Central Bank (ECB).
The European Commission conducts regular assessments of financial, economic, and policy developments, examining the underlying structural factors that drive them. This ongoing monitoring enables the Commission to evaluate the effectiveness of current policy measures and identify potential areas for future action, taking into account emerging risks and opportunities.
The 2026 edition of the European financial stability and integration review provides an in‑depth analysis of recent trends in financial markets and the financial sector. The report examines specific policy areas that have a significant impact on European financial stability and integration, highlighting key issues and challenges. This year’s edition emphasises the EU’s resilience in the face of geopolitical and economic challenges, while underscoring the need for continued progress in financial integration and stability.
The EU economy demonstrated resilience in 2025 despite trade disruptions and geopolitical tensions. However, the escalation of conflict in the Middle East in early 2026 has introduced new risks, including higher energy prices, inflationary pressures, and supply chain disruptions.
Financial stability risks remain elevated, with high public debt levels and potential disorderly market corrections posing significant concerns. The Banking Union and prudential policies continue to play a crucial role in reinforcing financial resilience, though further progress is needed. The Commission will issue a report on the competitiveness of the banking sector in July and will propose amendments to the banking framework by first quarter of 2027 to ensure the competitiveness of EU banks, promote simplification of EU banking rules and advance the single market in banking.
Euro‑area financial integration strengthened in 2025, making markets more efficient. However, geopolitical developments – such as the Middle East conflict – could reverse these gains if not carefully managed. Policy efforts, including the savings and investments union (SIU) strategy remain important to sustain momentum. Overall, risks to financial stability and financial integration require close monitoring and attention to ensure financial system resilience and unlock the EU’s economic potential.
Financial conditions for non‑financial corporations
One of the focus chapters in this edition analyses financing structures, access to finance conditions and financial resilience of non‑financial corporations (NFCs), highlighting the need for a more diversified funding base. EU NFCs continue to rely heavily on bank‑based financing, with domestic bank loans accounting for 46% of their total debt financing. Although the role of domestic banks has declined somewhat since the 2008 global financial crisis, EU NFCs continue to use considerably less market funding than NFCs in the UK and the US. The high reliance on bank lending also limits access to start‑up and scale‑up funding, which is critical for innovation and growth.
To address these challenges, the Commission has set out measures under the SIU strategy, including steps to foster a more supportive environment for venture and growth capital financing. As part of the broader SIU strategy, the Commission aims to improve access to finance and help firms to diversify their funding. This includes further integrating and scaling up capital markets via the market integration and supervision package, offering preferential prudential treatment for investments in legislative programmes for banks and insurers, and boosting financial literacy to encourage greater citizen participation. Additionally, the Commission’s review of venture capital and growth fund rules will further streamline the business environment and cut red tape.
Funded pensions landscape
The second special focus chapter looks at funded pensions. The EU’s funded pension landscape remains underdeveloped, with total pension assets managed by pension providers and public pension reserve funds amounting to just 32% of GDP. Except for a few Member States that have accumulated substantial pension assets, total pension assets in the EU are far below levels of other jurisdictions like Canada (185%), the US (162%), and Australia (144%).
Low participation rates in supplementary pension schemes, combined with limited equity exposure and low investment returns, present key challenges to developing a more mature funded pensions sector.
Reforms at EU and national level are needed to boost participation, equity exposure and efficiency. The Commission’s November 2025 pensions package aims to boost participation and improve the performance of funded pensions, through measures such as auto-enrolment, pension-tracking systems, and reforms to occupational pension rules and the regulation on the pan-European personal pension product (PEPP). These measures come on top of the country-specific analyses and recommendations issued under the European Semester.
Overall, the 2026 EFSIR highlights the need for continued policy action under the SIU initiative to deepen financial integration, strengthen corporate financing and support funded pensions. This will help channel long-term savings into productive investments, thereby promoting economic growth and stability in the EU.
Related links
European financial integration 2026
European financial stability and integration review 2026 (EFSIR)
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