Franco-Louis Michaud, the new head of the European Banking Authority, has stated that European banks are resilient enough to handle current financial and geopolitical shocks, but need to prepare for future uncertainties such as cybersecurity risks from AI. This comes as financial markets come under strain from the U.S. and Israeli war on Iran. The European Central Bank has warned that markets are underpricing the stress on the financial system due to geopolitical risks. The ECB has made strengthening lenders' resilience to these risks a priority for this year and will stress test the largest banks. Michaud also stated that private credit did not represent a systemic issue for European banks.