EU supervisors: bank customers will pay for cloud reliance outside the Union

A bank can hold strong capital and still rely on infrastructure run elsewhere for its core business. The Italian portal CorCom describes the autumn review of risks in the EU financial system, published on 23 September by the joint committee of supervisors Eba, Eiopa and Esma.

The document lists key weaknesses: technological dependence on companies based outside the Union, evolving cyber threats powered by artificial intelligence, and private credit risks. The issue is not just which services a bank buys. It is also whether the bank can keep operating when a provider suffers an outage, or when that provider becomes caught up in political decisions taken in another jurisdiction.

Who causes the greatest concern

In the Eba survey on dependence on entities outside the EU and the European Economic Area, institutions most often named IT service providers. Roughly 80 percent of respondents called these relationships their main critical dependence. Payment solutions came second, cited by about 60 percent of banks. Supervisors stress that these are the opinions of the institutions surveyed, not a measurement of providers' market share.

Concentration is a separate problem. When many banks use the same infrastructure, an outage at one provider hits all of them at once. That is why supervisors now look beyond the risk of a single bank and examine the technological relationships shared by the whole sector. Their recommendations include monitoring these dependencies, resilience testing against crisis scenarios, and controls and coordination under the EU's Dora regulation on the operational resilience of the financial sector.

Sovereignty as a product

Regulatory pressure immediately became a sales argument. The French outlet Le Monde Informatique describes the completed merger between Canada's Cohere and Germany's Aleph Alpha. The final agreement was signed on 16 September, and the new entity will operate under the name Cohere with headquarters in Toronto and Berlin. The combined company is valued at around 20 billion dollars, and Cohere shareholders are to hold about 90 percent of the shares. The deal still awaits regulatory approvals, with closing planned for 2026. Ilhan Scheer, currently co-managing Aleph Alpha, is to become chief operating officer, and Samuel Weinbach head of research.

The newsroom notes a disparity. Cohere's recurring revenue rose from about 62 million dollars at the end of 2024 to 240 million in 2025. Aleph Alpha, by contrast, had limited revenue and large losses, and had earlier given up developing top-class models in favour of integration software. Some observers therefore describe it as a takeover disguised as a merger.

The takeaway is twofold. For a financial institution, the question of where the server is located has stopped being an accounting matter and become part of risk management. For suppliers pitching an alternative to American hyperscalers, sovereignty is today the strongest sales argument, and at the same time the hardest to sustain, because it requires both scale and profit.