BANKS – 2026 BENCHMARKING EXERCISE
The EBA's Consultation Paper to amend the Implementing Regulation on the benchmarking of credit risk, market risk and IFRS9 models for the 2026 exercise closes on 26 May 2025.
Under Article 78 of the Capital Requirements Directive, the EBA must specify the benchmarking portfolios, templates and definitions to be used as part of the annual benchmarking exercises. These are used by competent authorities to conduct an annual assessment of the quality of internal approaches used for the calculation of own funds requirements.
More information: The EBA consults to amend data collection for the 2026 benchmarking exercise (European Banking Authority)
BANK CRISIS MANAGEMENT AND DEPOSIT INSURANCE FRAMEWORK
Another round of trilogue negotiations between the European Parliament and the Council of the EU on the proposed bank crisis management and deposit insurance (CMDI) framework is planned for 22 May 2025 after the negotiators failed to reach agreement on 28 April 2025. The importance of progress on the proposed CMDI framework was highlighted in the European Commission's strategy for the Savings and Investments Union, published in March 2025.
More information: Savings and Investments Union: Commission outlines its plans
More information: Bank Resolution: Commission CMDI proposal published
BANKS – RESOLVABILITY TESTING
The Single Resolution Board's consultation on its Operational Guidance for Resolvability Testing for Banks closes on 5 May 2025.
The operational guidance provides guidance to banks on testing areas and sub-areas, test methods, testing governance expectations, testing environment expectations, multi-annual testing programme and designing, preparing, and reporting on tests.
The SRB plans to publish the final version of the guidance in Q3 2025.
More information: SRB launches public consultation on resolvability testing for banks (Single Resolution Board)
BENCHMARKS REGULATION
Following the approval by the European Parliament of the proposed regulation amending the EU Benchmarks Regulation on 6 May 2025, the proposed regulation will now undergo final endorsement by the Council of the EU before being published in the Official Journal. The proposed regulation was adopted by the Council of the EU on 24 March 2025.
The proposed regulation covers the scope of the rules for benchmarks, the use in the EU of benchmarks provided by an administrator located in a third country, and certain reporting requirements. Once published in the Official Journal, the proposed regulation will come into force on 1 January 2026 and will make the following notable changes to the current framework:
- Only critical or significant benchmarks will be in-scope of the amended EU Benchmarks Regulation.
- Administrators of benchmarks defined as non-significant in the EU will be removed from the scope of the EU Benchmarks Regulation. However, those administrators may request the voluntary application of the EU Benchmarks Regulation if certain conditions are met.
- Administrators of EU climate transition benchmarks and EU Paris-aligned benchmarks will need to be registered, authorised, recognised, or endorsed to ensure regulatory oversight and prevent misleading ESG claims.
- There will be a specific exemption for spot foreign exchange benchmarks.
- ESMA's competence will be extended.
More information: Council adopts financial benchmarks regulation to ease burden on SMEs (Council of the EU)
CAPITAL REQUIREMENTS REGULATION - APPROPRIATENESS OF REAL ESTATE RISK WEIGHTS
The EBA's short public consultation on draft amending Regulatory Technical Standards (RTS) on the types of factors to be considered by national authorities in assessing the appropriateness of real estate risk weights (review mandated by the revised Capital Requirements Regulation (CRR 3)) closes on 30 May 2025.
The only proposed amendment to the existing RTS is to update legal references to align with the new banking framework.
The original RTS were delivered jointly with another set of technical standards on the appropriateness of the minimum loss given default values for retail exposures secured by immovable property. For the sake of simplification and regulatory consistency, the EBA has proposed to align both sets of RTS with CRR 3.
More information: The EBA consults on draft amending technical standards on factors assessing the appropriateness of real estate risk weights (European Banking Authority)
DIGITAL OPERATIONAL RESILIENCE ACT (DORA)
ESMA's Joint Guidelines on the estimation of aggregated annual costs and losses caused by major ICT-related incidents under the regulation on digital operational resilience for the financial sector (DORA) apply from 19 May 2025.
The guidelines, issued under Article 11 of DORA, also specify a common template for the submission of the aggregated annual costs and losses.
GREEN BONDS
ESMA's Consultation Paper on the remaining RTS for external reviewers under the EU Green Bonds Regulation closes on 30 May 2025.
The RTS that are the subject of this consultation relate to the following aspects of the external reviewer regime:
- Appropriateness, adequacy and effectiveness of systems, resources and procedures.
- Authority, resources, expertise and access to relevant information of the compliance function.
- Soundness of administrative and accounting procedures, internal control mechanisms and effectiveness of information systems controls.
- Quality and reliability of the sources of the information used for external reviews.
- Information, form and content of applications for recognition.
- Notification of material changes in the information provided at registration.
The first consultation on RTS for external reviewers under the EU Green Bonds Regulation took place between March and June 2024.
ESMA expects to publish a Final Report and submit the draft RTS that are the subject of the most recent consultation to the European Commission for adoption by 21 December 2025 at the latest.
INSURANCE
The Department of Finance's public consultation on supporting the Action Plan on Insurance Reform closes on 19 May 2025. The Programme for Government includes a commitment to develop a new Action Plan for Insurance Reform, with a focus on encouraging further competition in the market and working with stakeholders to enhance transparency and affordability across all types of insurance.
More information: Public consultation on insurance reform launched by Minister of State Troy and Minister Donohoe (Department of Finance)
EIOPA's consultation on its opinion on artificial intelligence governance and risk management, which gives guidance to supervisors and insurance undertakings on how to interpret and implement insurance sector provisions in light of the use of AI systems in insurance, closes on 12 May 2025.
More information: EIOPA is seeking feedback on its Opinion on Artificial Intelligence governance and risk management (European Insurance and Occupational Pensions Authority)
The IAIS draft issues paper on structural shifts in the life insurance sector closes on 19 May 2025. The issues paper primarily focuses on alternative assets, asset-intensive reinsurance, macroprudential and financial stability considerations, and areas for improvement in IAIS's supervisory material.
More information: Public consultation on draft Issues Paper on structural shifts in the life insurance sector (International Association of Insurance Supervisors)
MICA – CRYPTOASSETS AS FINANCIAL INSTRUMENTS
ESMA's guidelines on the conditions and criteria for the qualification of cryptoassets as financial instruments under Article 2(5) of regulation on markets in cryptoassets (MiCA) apply from 18 May 2025. The guidelines give more clarity about the delineation between the respective scopes of application of MiCA and other sectoral regulatory frameworks (notably the MiFID II Directive).
MICA – PORTFOLIO MANAGEMENT ACTIVITIES
ESMA's guidelines on the suitability requirements and format of the periodic statement for portfolio management activities under Article 81(15) of MiCA apply from 25 May 2025.
The guidelines specify:
- The information that cryptoasset service providers (CASPs) should obtain from their clients or prospective clients regarding their knowledge of and experience in investing, their investment objectives, their financial situation and their basic understanding of the risks involved in purchasing cryptoassets.
- The format of the periodic statements that CASPs providing the service of portfolio management of cryptoassets should provide to their clients setting out details of the portfolio management activities carried out on their behalf.
MICA – REGULATORY CLASSIFICATION OF CRYPTOASSETS
The European Supervisory Authorities guidelines on explanations and opinions under Article 97(1) of MiCA apply from 10 May 2025. The guidelines include a standardised test to promote a common approach to classification and templates that market participants should use when communicating the regulatory classification of a cryptoasset to supervisors.
NEO-BROKERS
IOSCO's consultation on neo-brokers closes on 12 May 2025. In the consultation document, IOSCO clarifies that neo-brokers are a subset of brokers, characterised by providing online-only investment services and by the absence of physical operating branches, who use technology to facilitate these services and access financial markets.
Two specific action areas are identified by IOSCO: potential conflicts of interest (mainly due to business models) and the need for solid IT infrastructure (given the online-only business model).
The report also sets out potential recommendations that IOSCO members may consider applying to the neo-brokers they regulate (relating to disclosure of fees and charges, advertising, disclosure and consent in respect of ancillary service offerings, the potential impact of non-commission related trading revenue on the best execution of client orders, and the robustness of IT infrastructure).
More information: IOSCO publishes Consultation Report on Neo-Brokers (International Organization of Securities Commissions)
PROSPECTUS REGULATION – EU FOLLOW-ON AND GROWTH ISSUANCE PROSPECTUSES
The European Commission's targeted consultation on the reduced content and the standardised format and sequence of the EU follow-on prospectus and the EU growth issuance prospectus closes on 2 May 2025.
The amendments made by the EU Listing Regulation to the EU Prospectus Regulation will introduce two new short-form prospectuses from March 2026:
- The EU follow‑on prospectus for follow-on issuances by companies whose securities have been admitted to trading on a regulated market or an SME growth market for at least 18 months on a continuous basis, including companies that are seeking to make a transition from an SME growth market to a regulated market. This will replace the simplified disclosure regime for secondary issuances under the EU Prospectus Regulation (viewed as being "too prescriptive and too close to that of a standard prospectus to make a significant difference"). It will also replace EU Recovery Prospectuses.
- The EU growth issuance prospectus is designed for SMEs, companies listed or to be listed on SME growth markets, and for small unlisted public offers of securities up to €50 million. This will replace the current EU Growth Prospectus (again because the existing format is seen to be too prescriptive and too close to the requirements of a standard prospectus).
PROSPECTUS REGULATION – SUPPLEMENTS
ESMA's consultation on guidelines on supplements that introduce new types of securities to a base prospectus closes on 19 May 2025. The guidelines aim to harmonise the supervision of product supplements across national competent authorities in light of supervisory divergence. The recitals to the recent EU Listing Regulation noted the existence of diverging interpretations. The EU Listing Regulation amended the EU Prospectus Regulation by introducing a new Article 23(4a) ("a supplement to a base prospectus shall not be used to introduce a new type of security for which the necessary information has not been included in that base prospectus") and a new Article 23(8) (requiring ESMA to "develop Guidelines to specify the circumstances in which a supplement is to be considered to introduce a new type of security that is not already described in a base prospectus").
ESMA is looking for feedback on the following two draft guidelines:
- Draft Guideline 1: "A supplement should include information which is material to assessing the securities that are already mentioned in the base prospectus. The addition of information about new types of security features into a base prospectus using a supplement does not provide information which is material to assessing the securities that are already mentioned in the base prospectus."
- Draft Guideline 2: "Issuers should consider the various types of securities they reasonably expect to issue during the validity period of the base prospectus and should appropriately provide for them when they submit their base prospectus for approval. This should be done by including disclosure such as the risk factors associated with the relevant type of securities as well as the overarching terms and conditions that are applicable and by identifying the type of securities which the issuer will issue in the overview of the programme." (The consultation identifies green bonds and sustainability-linked notes as distinct securities for the purposes of the draft guidelines – one ESMA query is whether they should be treated as distinct or not).
ESMA plans to publish a Final Report and Guidelines in Q4 2025.
More information: ESMA proposes guidelines on product supplements (European Securities and Markets Authority)
SUSTAINABLE FINANCE DISCLOSURES REGULATION
The European Commission's call for evidence on changes to the Sustainable Finance Disclosures Regulation (SFDR) was launched on 2 May 2025 and closes on 30 May 2025. The Commission intends to publish its proposals to revise the SFDR in Q4 2025, following two 3-month consultations in Q4 2023 (a public consultation and a targeted consultation).
The 2023 targeted consultation included two sections which queried the usefulness of the existing disclosures framework and sought views on whether a voluntary categorisation system for financial products might work better. The Commission had noted that the "SFDR was designed as a disclosure regime, but is being used as a labelling system, suggesting that there might be a demand for establishing sustainability product categories."
The Platform on Sustainable Finance (which advises the Commission on the EU Taxonomy and the wider sustainable finance framework) published a Briefing Note for the Commission in December 2024 which recommended a transition from the existing disclosures regime to a product categorisation system (allowing products to be differentiated based on whether they can largely be considered sustainable, whether they foster the transition to net zero, or whether they exclude sectors/companies based on ESG performance).
This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.
