On 24 February 2026 Pedro Machado, ECB representative to the Supervisory Board, delivered 'Technology is neutral, governance is not: AI adoption in the banking sector' at the KPMG RiskTech Conference in Frankfurt. He reported that more than 85% of large European banks use AI, with generative and agentic AI accelerating in IT operations, legal and document analysis and front-line applications, and set three governance expectations: clear accountability for AI decisions, senior-management oversight matching AI's strategic importance, and effective challenge from risk, compliance and internal audit. Risk-management focus areas are explainability, lifecycle model governance and drift, data quality, and third-party risk, aligned with DORA, the AI Act, MiCAR and the DSA.
| Document | Machado speech: 'Technology is neutral, governance is not' (Feb 2026) — Technology is neutral, governance is not: AI adoption in the banking sector — speech by Pedro Machado |
| Issued by | European Central Bank — Banking Supervision (SSM) |
| Type | Speech |
| Status | Final |
| Published | Feb 24, 2026 |
| Applies to | No obligations; the most detailed public statement of ECB supervisory expectations for AI governance at significant institutions. |
| Official source | bankingsupervision.europa.eu ↗ |
| Use cases | AI governance (general) · Generative & agentic AI · Model risk management · Third-party & vendor AI |
What are the key points of Machado speech: 'Technology is neutral, governance is not' (Feb 2026)?
- More than 85% of large European banks use AI; generative and agentic AI adoption accelerating
- Most common gen-AI use cases: IT operations (incident management, coding), legal/document analysis, front-line customer support, plus traditional credit risk, fraud and transaction monitoring
- Three governance expectations: accountability for AI outcomes, senior-management oversight, independent challenge by risk, compliance and internal audit
- Risk-management focus: explainability for decision-makers, lifecycle model governance and drift monitoring, AI-specific data quality, third-party risk
- Banks are accountable for outcomes regardless of how the technology performs — 'technology is neutral, governance is not'
- Under Priority 2 of the 2026–28 priorities the ECB will monitor general AI use and take a more targeted approach to generative AI
- Expectations anchored in DORA, EU AI Act, MiCAR and the Digital Services Act
What did Machado speech: 'Technology is neutral, governance is not' (Feb 2026) change for banks?
The speech is the closest thing to an ECB AI governance standard: it tells boards what the second and third lines must do for AI, and confirms that the ECB judges AI through accountability and control quality rather than technology choice.
What does the ECB expect from bank boards on AI governance?
Per Machado's February 2026 speech: clear accountability for AI decisions, senior-management oversight proportional to AI's strategic role, and robust challenge from risk management, compliance and internal audit, plus explainability, lifecycle model governance, data quality and third-party controls.
| Date | Document | Status |
|---|---|---|
| Jul 7, 2026 | ECB 'Dear CEO' letter on AI-enabled cybersecurity threats (SSM-2026-0301) — Addressing AI-enabled cybersecurity threats — letter from the Chair of the Supervisory Board to CEOs of significant institutions | In force |
| Jun 3, 2026 | Elderson speech: 'Strengthening operational resilience for the age of AI' (June 2026) — Strengthening operational resilience for the age of AI — speech by Frank Elderson | Final |
| Feb 3, 2026 | Montagner speech: 'Encouraging innovation, managing risks' (Feb 2026) — Encouraging innovation, managing risks: the ECB's approach to digital transformation — speech by Patrick Montagner | Final |
| Nov 20, 2025 | Supervision Newsletter: AI use cases for credit scoring and fraud detection (Nov 2025) — AI's impact on banking: use cases for credit scoring and fraud detection (Supervision Newsletter, November 2025) | Final |
| Nov 18, 2025 | SSM supervisory priorities 2026–28 — ECB Banking Supervision: SSM supervisory priorities for 2026–28 | In force |
| Oct 14, 2025 | Machado speech: 'Artificial intelligence and supervision: innovation with caution' (Oct 2025) — Artificial intelligence and supervision: innovation with caution — speech by Pedro Machado | Final |
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