Horizon Scanner Finance May 2026 - European Developments

AML Regulation – customer due diligence requirements

The Authority for Anti-Money Laundering and Countering the Financing of Terrorism’s (AMLA) consultation on draft Regulatory Technical Standards (RTS) under Article 28(1) of Regulation (EU) 2024/1624 (the AML Regulation) closes for feedback on 8 May 2026.

The draft RTS set out the requirements and information to be collected for standard customer due diligence (CDD), simplified due diligence (SDD) and enhanced due diligence (EDD) purposes, with the aim of harmonising the way AML/CFT requirements are applied in the EU. The feedback provided to this consultation will be considered by AMLA when preparing the final RTS to be submitted to the European Commission (the Commission) for adoption.

Press release: AMLA consults on key mandates for the private sector and harmonized supervision

Consultation paper: Consultation on the draft RTS on Customer Due Diligence

AML Regulation – business relationships, occasional transactions and linked transactions

AMLA’s consultation on draft RTS under Article 28(1) of the AML Regulation closes for feedback on 8 May 2026. The draft RTS set out criteria to be taken into account by obliged entities for identifying business relationships, occasional transactions and linked transactions.

Distinguishing between business relationships and occasional transactions is a key step in applying the AML/CFT framework. For business relationships, obliged entities must always perform CDD. For occasional transactions, CDD is only required when the transaction value exceeds certain thresholds. Identifying linked transactions is important to ensure that criminals do not circumvent these thresholds by structuring their activities across multiple smaller transactions.

AMLA has the option under the AML Regulation to set additional lower CDD thresholds for occasional transactions. At this stage, it has chosen not to exercise this option.

Press release: AMLA consults on key mandates for the private sector and harmonized supervision

Consultation paper: Consultation on the draft RTS on criteria for identifying business relationships, occasional and linked transactions and lower thresholds

Benchmarks Regulation (BMR) – spot FX benchmarks

Commission Implementing Regulation (EU) 2026/905 of 24 April 2026 supplementing Regulation (EU) 2016/1011 of the European Parliament and of the Council (the BMR) by establishing a list of spot foreign exchange benchmarks exempt from its application enters into force on 17 May 2026.

The implementing regulation introduces a list of spot FX benchmarks that are exempt from the requirements of the BMR. The aim is to ensure that EU banks, investment funds and businesses continue to have access to spot FX benchmarks that are widely used for hedging purposes, even where the administrators of these rates may not have the incentive to comply with the BMR.

Capital Requirements Regulation – FRTB

The Commission’s consultation on a draft delegated regulation amending Regulation (EU) No 575/2013 (the Capital Requirements Regulation (CRR)) to introduce temporary targeted operational relief measures and targeted multipliers for the calculation of institutions' own funds requirements for market risk closes on 19 May 2026.

The core purpose is to address concerns about maintaining a level international playing field (particularly due to delays and uncertainties in implementing the Basel III standards by the US) by introducing a suite of targeted temporary amendments to the prudential framework, including an overall multiplier to offset capital increases experienced by EU banks under the FRTB (Fundamental Review of the Trading Book) rules.

The draft delegated regulation (which reflects feedback from a two-month long 2025 consultation) envisages that the measures will run for three years, until 31 December 2029.

Formal adoption of the delegated regulation is expected at the end of the consultation period. Once adopted and published in the Official Journal, the delegated regulation will enter into force on the day following its publication, but will only apply from 1 January 2027 (which timeline should provide banks and national competent authorities sufficient visibility to implement the framework).

Press release: Commission seeks views on market risk prudential requirements for EU banks - Finance

Draft commission delegated regulation: Market risks – own funds requirements (delegated act)

Capital Requirements Regulation - supervisory reporting

The European Banking Authority’s (EBA) has an open consultation on revised Implementing Technical Standards (ITS) on supervisory reporting. While the main body of the consultation is open for feedback until 10 July 2026, comments on the IFRS 18-related requirements can only be submitted until 10 May 2026.

The consultation combines regulatory‑driven amendments and enhancements with a broad set of simplification measures informed by supervisory experience and stakeholder input. Amongst other things, the proposed simplification measures focus on reducing data points and templates, adjusting reporting frequency and scope, and enhancing proportionality for small and non‑complex institutions (SNCIs). Separately, the adoption of IFRS 18 on presentation and disclosure in financial statements requires corresponding adjustments to the reporting requirements for financial information in order to align it with the new IFRS standards.

The EBA plans to finalise the revised ITS following the public consultation and submit the final report to the Commission for adoption by the end of 2026. First reporting under the revised framework is expected for the reference date of 30 September 2027 (with appropriate transitional arrangements).

Press release: The EBA consults on major simplification of supervisory reporting to deliver a simpler, smarter and more proportionate framework

Consultation paper: EBA CP 2026 07 (Consultation paper on revised ITS on supervisory reporting).pdf

CMDI package

On 20 April 2026 the EU’s Bank Crisis Management and Deposit Insurance (CMDI) reform package was published in the Official Journal. The package comprises three legislative files:

• Regulation (EU) 2026/808, which amends the Single Resolution Mechanism (SRM) Regulation (806/2014) as regards early intervention measures, conditions for resolution and funding of resolution action (SRMR3).
• Directive (EU) 2026/804, which amends the Deposit Guarantee Schemes Directive (2014/49/EU) (DGSD) as regards the scope of deposit protection, use of deposit guarantee schemes funds, cross-border co-operation and transparency (DGSD2).
• Directive (EU) 2026/806, which amends the Bank Recovery and Resolution Directive (2014/59/EU) (BRRD) as regards early intervention measures, conditions for resolution and funding of resolution action and Directive 2014/24/EU as regards valuation services in resolution (BRRD3).

The SRMR3 amendments enter into force on 10 May 2026 and will apply from 11 May 2028, with some exceptions that will apply from 11 June 2026.

As regards DGSD2, the directive enters into force on 10 May 2026. Member States are required to publish their national transposing measures by 11 May 2028 and to apply them from that date, with some exceptions that will apply from 11 May 2029.

As regards BRRD3, the directive enters into force on 10 May 2026, with two exceptions (Article 1, point (65) will apply from 11 May 2026 and Article 1, points (44)(b) and (c), will apply from 12 May 2028 instead). Member States are required to publish their national transposing measures by 11 May 2028 and to apply them from 12 May 2028.

CRD VI

The European Securities and Markets Authority (ESMA) and the EBA’s joint consultation on draft guidelines on the assessment of the suitability of members of the management body and key function holders under Directive 2013/36/EU (CRD IV) and Directive 2014/65/EU (MiFID II) closes for feedback on 25 May 2026.

The proposed revisions reflect new requirements for large institutions introduced by CRD VI and cover (amongst other things):

• Ex-ante applications: guidance on the use of ex-ante applications in cases where competent authorities carry out ex-post assessments.
• Mandatory suitability assessments: competent authorities will be required to conduct suitability assessments for key roles, including heads of control functions and chief financial officers.
• Third-country branches (TCBs): new guidance reflecting CRD VI requirements applicable to TCBs.
• ML/TF risk indicators: guidance to help identify reasonable grounds to suspect money laundering or terrorist financing risks.

The EBA’s consultation on draft RTS to specify the minimum content of the suitability questionnaire, CV and internal suitability assessment to be submitted to the competent authorities for performing the suitability assessment referred to in Article 91(1f) and Article 91a(5) for entities listed in Article 91(1d) of CRD IV closes for feedback on 26 May 2026. The aim of the consultation is to harmonise submissions across the EU to ensure they are consistent, complete and comparable.

Press release: The EBA and ESMA launch a consultation on the revised suitability assessment framework for banks and investment firms

Consultation papers:

• CP on the draft joint ESMA and EBA guidelines on the assessment of the suitability of members of the management body and key function holders
• CP on RTS to specify the minimum content of the suitability questionnaire

Credit risk framework

The EBA’s discussion paper on simplifying the credit risk framework closes for feedback on 10 May 2026.

The EBA published a “Report on the efficiency of the regulatory and supervisory framework” in October 2025, which listed 21 actions to simplify the framework, including launching a comprehensive review of both the new flow of mandates (that is, those not yet issued for consultation) as well as the existing stock (current products from the EBA single rulebook). The discussion paper assesses how this review should be executed in the credit risk framework, where the EBA has received the most mandates as part of the legislative reforms to the EU’s prudential framework for banks. The discussion paper also assesses more broadly how the objectives of efficiency and simplicity in the design of European prudential rules can be supported

Discussion paper: Discussion paper on simplification and assessment of the credit risk framework.pdf

Private credit ratings

ESMA’s call for evidence on restricted subscription and private credit ratings closes for feedback on 31 May 2026.

The call for evidence seeks stakeholder views on the purposes, market practices, needs and risks associated with ‘restricted subscription credit ratings’ and private credit ratings, against the background of Regulation (EC) No 1060/2009 on credit rating agencies (the CRA Regulation). Market developments suggest that restricted subscription and private credit ratings are increasingly used alongside, or in place of, publicly disseminated ratings, particularly in private market segments. This evolution raises questions about the purposes and market needs these products are intended to serve; the way in which they are produced, distributed and used in practice; and the potential benefits and risks associated with selective access to rating information (including risks of information asymmetry and inconsistent safeguards).

This call for evidence is an early signal that ESMA is considering whether regulatory adjustments or clarifications to the application of the CRA Regulation may be needed.

Press release: ESMA launches a call for evidence on restricted subscription and private credit ratings

Call for evidence: Call for Evidence on the restricted subscription and private credit ratings