(Bloomberg) -- Claudia Buch, who’s vying to become Europe’s top banking regulator, said she’d focus on adapting the European Central Bank’s oversight arm to new risks and an unpredictable economic environment.

In testimony Wednesday to the European Parliament, the Bundesbank vice president said banks don’t take sufficient account of the potential fallout from geopolitical and macroeconomic developments as well as climate change. She also cited pressure on lenders to take “excessive risks” as digital technology allows competitors from outside traditional banking to eat into their profits.

Buch is seeking the approval of lawmakers after the ECB’s Governing Council nominated her as the next chair of its Supervisory Board, disregarding the findings of Parliament’s Economic and Monetary Affairs Committee, which had endorsed her competitor for the role.

While lawmakers expressed concern in the hearing, the German defended her credentials and dedication to the prospective role, adding that it wasn’t for her to comment on the nomination process.

The Bundesbank executive said she’s committed to ensuring the financial health of European lenders, telling lawmakers that “strong supervision must ensure that banks are well governed and have sufficient capital and liquidity buffers.”

Buch said she’d continue efforts that the ECB has started to overhaul its banking-supervision arm, known as the Single Supervisory Mechanism.

Supervisory Board Chair Andrea Enria will step down at year-end. In an interview this month with Bloomberg, he outlined plans to ease the burden of banks’ annual risk reviews and move away from higher capital requirements as the default tool for pushing lenders to fix problems.

Buch said digital technology can also make the watchdog more efficient and that she’ll work to simplify risk reviews — a process that’s been faulted as cumbersome.

“We can build on a culture in the SSM that promotes intrusive supervision,” Buch said. A new approach being kicked off by Enria to focus on the most relevant issues facing banks “sets the focus on relevant risks,” she said.

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