EU & UK Reg Round-Up: 28/08/2025
European Banking Authority
The EBA updates data used for the identification of global systemically important institutions (G-SIIs)
26 August 2025
The EBA has updated its dataset for the identification of global systemically important institutions (G-SIIs), covering the 32 largest EU banks with leverage exposures above EUR 200bn, based on end-2024 figures. The data, which feeds into the BCBS/FSB’s annual G-SIB assessment due in November, shows rising systemic indicators across the board: aggregate exposures up 3.4%, trading volumes up nearly 40%, and strong increases in OTC derivatives, securities, custody assets, and underwriting activity, all at or near their highest levels since 2013, while intra-financial system liabilities were the only measure to decline. National competent authorities will use this information to designate G-SIIs and assign higher capital buffers, applying from 2026, with the EBA continuing to go beyond BCBS minimum disclosure standards to promote transparency and comparability across the EU.
The EBA publishes its final standards for off-balance sheet items conversion factors
18 August 2025
The EBA has published its final draft Regulatory Technical Standards (RTS) on the allocation of off-balance sheet items and the specification of factors that may constrain banks’ ability to cancel unconditionally cancellable commitments. The RTS clarify how institutions should classify off-balance sheet exposures under the Standardised Approach for Credit Risk when items are not already assigned to a bucket under Annex I of the CRR, introducing criteria based on financial covenants, non-credit related conditions, and the level of obligor optionality. The standards also set out four factors linked to risk management processes, commercial considerations, reputational risk, and litigation risk—that could limit banks’ ability to cancel commitments deemed unconditionally cancellable. To reduce reporting burden, the EBA proposes to use the COREP framework for the notification process of such items. Developed under Article 111(8) CRR, these RTS aim to ensure consistent application of conversion factors across the EU, increasing clarity and comparability in the treatment of off-balance sheet exposures.
The EBA publishes statement confirming its response to the new European Commission’s Delegated Act postponing the market risk framework in the EU
08 August 2025
The EBA has confirmed its response to the European Commission’s Delegated Act that postpones the implementation of the revised market risk framework in the EU, known as the Fundamental Review of the Trading Book (FRTB). In a statement, the EBA reiterated that its no action letter of 12 August 2024 remains fully valid during the extended postponement, meaning institutions will not be penalised for not applying the delayed requirements. The EBA also confirmed that its earlier considerations on specific issues linked to the FRTB postponement continue to apply, providing regulatory certainty for banks while the revised timeline is in place.
The EBA amends technical standards specifying the data collection for the 2026 benchmarking exercise
08 August 2025
The EBA has published final draft Implementing Technical Standards (ITS) amending the rules for the 2026 EU-wide benchmarking exercise on credit and market risk. The main change concerns market risk, where data collection will be limited to information on the alternative standardised approach (ASA) from banks with internal model approval, while templates for the alternative internal model approach (AIMA) will not be implemented due to the further delay of the FRTB framework. The sample of participating banks remains unchanged from 2024, with supervisors preferring to focus on ASA data. Data submission deadlines have also been slightly postponed to support banks’ transition to DPM 2.0. For credit risk, only minor adjustments are introduced, primarily aligning benchmarking portfolio definitions with the updated IRB templates under the revised ITS on supervisory reporting following Basel III implementation, ensuring consistency and continuity in banks’ reporting processes.
The EBA publishes its final draft technical standards on the equivalent legal mechanism for unfinished property exposures under the Standardised Approach for credit risk
06 August 2025
The EBA has published its final Regulatory Technical Standards (RTS) on what qualifies as an “equivalent legal mechanism” for unfinished property exposures under the Standardised Approach for credit risk in the CRR. The RTS set out the conditions that must be met for a property under construction to be recognised in own funds calculations, including strict requirements for the guarantor and guarantee terms. Compared to the earlier consultation, the final standards adopt a broader approach that allows recognition of national completion guarantee schemes in certain Member States, provided they meet harmonised safeguards such as minimum creditworthiness criteria, a 20% risk weight cap, and enforceability conditions. This measure, part of the EBA’s Banking Package roadmap, aims to balance prudential soundness with practical applicability across the EU.
European Securities and Markets Authority
ESMA and the European Environment Agency signed a Memorandum of Understanding to strengthen their cooperation in sustainable finance area
20 August 2025
ESMA and the European Environment Agency (EEA) have signed a Memorandum of Understanding (MoU) to strengthen cooperation in the field of sustainable finance, with a focus on integrating environmental factors into the EU sustainable finance framework and its supervision. The agreement establishes mechanisms for exchanging data, expertise, and information, as well as supporting joint capacity-building activities. It also promotes collaboration between national securities regulators and environmental authorities, and enhances policy dialogue on biodiversity, climate change, and pollution. Both institutions expect the partnership to create synergies, avoid duplication of efforts, and support the effective implementation of the EU’s sustainable finance agenda.
Bank of England
Review of the analytical framework supporting financial policy at the Bank of England
19 August 2025
The Bank of England, in its Financial Stability Paper, conducts a strategic review of the analytical framework underpinning its Financial Policy Committee (FPC). The review emphasizes the need for enhancements across three critical areas: refining the FPC’s objectives and instruments by articulating what stable provision of essential services to the real economy looks like and improving the system-wide policy strategy; advancing risk-assessment and policy evaluation tools including more systematic mapping of vulnerabilities and frictions, and leveraging data analytics and scenario modelling; and strengthening the data foundation by maximizing value from existing datasets, identifying data gaps, and systematically incorporating qualitative tools like horizon scanning and exploratory stress exercises. These enhancements are meant to prepare the FPC’s analytical toolkit for evolving threats—from non-bank sector vulnerabilities to operational risks over the next decade and serve as a foundation for broader engagement with external experts and practitioners
Amendments to the UK EMIR Trade Repository reporting requirements – August 2025
08 August 2025
The Bank of England, in collaboration with the FCA, has finalised amendments to UK EMIR Trade Repository reporting standards to improve clarity and data quality. A new optional field titled ‘Execution agent’ (Field 30) will be added to Table 3 of the Annexes in the Technical Standards so that execution agents can be identified consistently in reporting outputs. A cross-referencing error in Article 8 regarding Unique Transaction Identifiers has also been corrected. Following stakeholder feedback, the implementation date has been adjusted to 26 January 2026 to take account of industry readiness and system change-freeze periods. The final Validation Rules and revised XML schemas covering both incoming and outgoing messages to Trade Repositories will become effective at the same time. These changes are intended to simplify reporting workflows and eliminate interim workarounds while supporting financial stability through better derivatives data
Monetary Policy Report - August 2025
07 August 2025
The Monetary Policy Committee voted by a narrow 5–4 majority to lower Bank Rate by 0.25 percentage points from 4.25% to 4%. The committee emphasised that disinflation has progressed over the past two and a half years, thanks to a restrictive policy stance. Inflation, however, remains elevated; CPI rose to 3.5% in the second quarter of 2025, driven by energy, food, and administered prices, and is expected to peak at 4.0% in September before gradually returning to the 2% target. Pay growth remains elevated but is slowing; services inflation has been stable. The Bank reaffirmed its gradual and data-driven approach to further policy easing, noting that monetary policy is not pre-set and future moves will depend on continued easing in disinflationary pressures