The European Banking Authority (EBA) has published an opinion responding to the European Commission's (EC) proposed amendments to the EBA's final draft regulatory technical standards (RTS) on operational risk under the Capital Requirements Regulation (CRR) as amended by CRR3. The EBA previously published reports on the final draft RTS and implementing technical standards in June 2025, followed by further final draft RTS on operational risk loss, in August 2025. In March, the EC informed the EBA in a letter of its intention to endorse the draft RTS with amendments, including bundling the RTS into one single Commission Delegated Regulation.

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The Council of the EU has published notes from its General Secretariat to the Permanent Representatives Committee (COREPER), setting out the final compromise text for the proposed revised Payment Services Directive (PSD3) and Payment Services Regulation (PSR), collectively known as "the Payment Services Package". The legislative package aims to modernise the EU's regulatory framework for payment services, building on the foundations of PSD2 to enhance consumer protection, strengthen fraud prevention and improve the functioning of open banking. It also seeks to address the pending challenges in the context of the impact and application of PSD2 in the internal market and adapt it to align with new market developments.

The Council also published an "I" item note from its General Secretariat, suggesting that COREPER approves the text of the draft Directive and draft Regulation with a view to reaching an agreement at second reading with the European Parliament (EP). The Council and the EP agreed their respective negotiating positions on the legislative proposals in June 2025 and April 2024, which we cover in more detail in our blog post titled "European Council and Parliament reach provisional agreement on EU Payments Package". For more background on the proposed package, you may wish to read our article titled "Paving the way for the future of payments - The PSD III package is here: discover its key features".

The UK Prudential Regulation Authority (PRA) has published policy statement LIAF01/26, finalising a series of amendments to its Rulebook and policy materials that it considers low impact. The changes include:

• Finalisation of amendments to the Fees Part of the PRA Rulebook consulted on in the PRA's November 2025 consultation on regulatory fees and levies for 2026/27, which include updating invoice due dates for firms paying GBP50,000 or more in annual PRA and UK Financial Conduct Authority fees (effective 30 April).
• Removal of redundant MiFID Organisational Regulation references from the Skills, Knowledge and Expertise Part of the Rulebook following post‑EU withdrawal reforms (effective 30 April).
• Clarificatory amendments to Statement of Policy (SoP) 2/23 on the Small Domestic Deposit Taker (SDDT) regime, providing guidance for applicants with non‑UK parent undertakings (effective 23 April).

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The UK Financial Conduct Authority (FCA) and UK Prudential Regulation Authority (PRA) have published final policy statements (FCA PS26/6 and PRA PS12/26) on Phase 1 reforms to the Senior Managers and Certification Regime (SMCR). The reforms largely implement proposals as consulted on in July 2025. For more detail on the reforms, you may wish to read our blog post titled UK Senior Managers and Certification Regime overhaul: understanding proposals for reform.

The FCA's reforms focus on streamlining administrative requirements and include greater flexibility around the 12‑week rule (allowing firms 12 weeks to submit, rather than obtain approval for, Senior Management Function (SMF) applications), extended validity periods for criminal record checks, simplified requirements for statements of responsibilities and management responsibilities maps (with firms given up to six months to notify changes), removal of overlapping multiple certifications within the Certification Regime, updated guidance on Fit and Proper recertification, extended deadlines for updating the Directory (from seven to 20 business days), and raising certain enhanced firm thresholds by 30%.

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HM Treasury (HMT) has published the response to its July 2025 consultation on reforming the Senior Managers and Certification Regime (SMCR). The response concerns Phase 2 of the reforms and confirms the government's planned reforms to the Financial Services and Markets Act 2000, including to:

• Remove the Certification Regime from primary legislation, including the annual recertification requirement, and enable the regulators to consider a more proportionate and flexible framework in their rulebooks.
• Reduce the number of senior management functions that require regulator pre-approval. Regulators will be given a new power to specify circumstances where it would be suitable for a firm to notify the regulators of the appointment of a senior manager following the firm's assessment of fitness and propriety.

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HM Treasury has announced a package of reforms aimed at modernising the UK payments regulatory framework to support innovation while maintaining consumer protection. The government confirms that it will shortly consult on reforms which include:

• Integrating the regulation of payment services and electronic money into the UK's core financial services framework, creating a single regime covering both traditional and tokenised payments (including stablecoins and tokenised deposits).
• Regulating stablecoins used for payments under a new UK regulated activity, alongside legislation to reduce administrative burdens for stablecoin payment providers.
• Adapting payments regulation to address payments conducted by AI agents.
• Granting the FCA new powers to oversee the future development of open banking and commercial open banking payment schemes.
• Streamlining regulation by setting out the government's response to consolidating the UK Payments Systems Regulator within the UK Financial Conduct Authority.
• Appointing a Wholesale Digital Markets Champion to support the development of tokenised wholesale markets as part of the government's wholesale financial markets digital strategy.

HM Treasury (HMT) has published its response to its September 2025 consultation, confirming its intention to proceed with abolishing the UK Payment Systems Regulator (PSR) and consolidating its functions within the UK Financial Conduct Authority (FCA), subject to primary legislation. While responses were broadly supportive of integration within the FCA's existing FSMA framework, the government is still considering different legislative design options and will reflect further on feedback before finalising the model.

Key points from the response include:

• The PSR's functions under assimilated payment services legislation will transfer to the FCA, including functions under the Payment Services Regulations 2017, the Payment Card Interchange Fee Regulations 2015 and the Payment Accounts Regulations 2015 (including oversight of the Current Account Switching Service), alongside retention of a designation regime for bringing payment systems into and out of scope of regulation.
• Transitional legislation will preserve existing PSR requirements, technical standards and guidance (including those relating to the authorised push payment scam reimbursement regime), with the FCA determining its regulatory approach under the new framework. These transferred functions may be reviewed as part of HMT's wider programme to modernise and future proof payment services and e money law, which it will set out in detail in due course.

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HM Treasury (HMT) has published the draft Financial Services and Markets Act 2000 (Cryptoassets) (Amendment) Regulations 2026 and a policy note proposing targeted changes to the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026. The draft statutory instrument (SI) seeks to address unintended consequences of the cryptoasset regime and support the interim use of UK‑issued qualifying stablecoins (UKQS) for payments ahead of wider payments services reforms announced in a related press release. The reforms are expected to bring UKQS payment services into the regulated payments perimeter.

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The UK Financial Conduct Authority (FCA) has published a speech by Jessica Rusu, chief data, information and intelligence officer, setting out how the FCA intends to support fintech firms in the next phase of innovation amid rapid advances in AI and the emergence of "agentic commerce".

The FCA highlighted its principles-led, outcomes focused approach to AI regulation and announced the next phase of its AI Lab, including: (i) an extended partnership with NVIDIA and NayaOne; (ii) a second cohort of firms entering AI Live Testing, which will conclude by the end of the year, with an evaluation report expected in Q1 2027; (iii) the scaling of the Supercharged Sandbox, giving more UK fintechs access to data and Nvidia compute to build their products, with a second intake opening on 5 May; and (iv) confirmation that the FCA will not introduce new AI specific rules at this stage, but will instead publish examples of good and poor practice later in the year. In parallel, the FCA emphasised the role of its recently published open finance roadmap and announced that its Scale Up Unit is now open for expressions of interest from solo regulated firms to support them in scaling and entering new markets.

The UK Financial Conduct Authority (FCA) has published a new webpage setting out good and poor practice identified from a review on managing potential risks arising from inactive appointed representatives (ARs). The FCA states that where ARs carry out no regulated activities, principals cannot rely on transaction based oversight and must ensure effective governance, monitoring and engagement. Unexplained inactivity may indicate weaknesses in the principal's governance, monitoring, oversight and risk management and increase the risk of consumer harm. The FCA expects firms to: reflect on whether arrangements for inactive ARs remain appropriate; provide clear explanations in REP025 regulatory returns where ARs have not carried out regulated activities during the specific reporting period; and take timely action to reassess, suspend or terminate AR relationships where appropriate, including notifying the FCA when the status of the relationship changes.

Good practice included clear expectations set at onboarding, active and data led oversight, and early intervention on inactive ARs. Poor practice included situations where principals lacked understanding of AR business models, allowed prolonged inactivity without engagement, or failed to monitor how ARs presented themselves to consumers, increasing the risk of consumers being misled about regulatory status. The FCA notes that some firms have already strengthened oversight and offboarded inactive ARs following supervisory engagement and it expects all principals to review their arrangements to ensure risks are appropriately managed.

The European Commission has adopted two Delegated Regulations supplementing the Environmental, Social And Governance (ESG) Ratings Regulation (EU) 2024/3005 on the transparency and integrity of ESG rating activities. Both Regulations are based on the final draft RTS published by the European Securities and Markets Authority in October 2025. They will enter into force on the 20th day following publication in the Official Journal of the European Union and will apply from 2 July.

The first Delegated Regulation sets out regulatory technical standards (RTS) on the separation of ESG rating activities from other business activities carried on by ESG rating providers. It specifies the measures and safeguards applicable where a derogation from the separation requirement is relied upon, to prevent conflicts of interest. In particular, providers must establish separate organisational structures and working environments for staff involved in the rating process from any activities listed in Article 16(1) of the ESG Ratings Regulation. Staff will also require regular self declarations confirming non involvement in those activities. Additional technical and internal control measures apply where providers intend to carry on investment services and/or insurance or reinsurance activities, with further safeguards for those that provide, or intend to provide, benchmarks.

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The European Commission has launched a consultation on a draft delegated act proposing targeted amendments to the EU prudential framework for banks' market risk, specifically the Fundamental Review of the Trading Book (FRTB) under the Capital Requirements Regulation (CRR). While most Basel III reforms have applied since 1 January 2025, the FRTB has been deferred on several occasions, most recently to 1 January 2027 in response to uncertainty around implementation timelines and potential deviations from the Basel standards in other major jurisdictions. The draft delegated act sets out amendments, intended to apply from 1 January 2027, to support a level playing field for EU banks competing internationally in trading activities by offsetting the negative capital impact of the FRTB for a period of three years. The proposals reflect feedback from a November 2025 consultation and input from member state experts. Formal adoption of the delegated act is expected on 19 May, to provide banks and supervisors with greater certainty ahead of implementation.

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The UK Financial Conduct Authority (FCA) has published its innovation insights 2025 report, setting out key trends in UK fintech innovation, evolving regulatory risks and lessons from firms' engagement with the FCA's innovation services. By sharing insights, the FCA aims to support earlier and clearer regulatory engagement and strengthen evidence-led policy and supervision.

The report notes that while global fintech investment exceeded USD130 billion in 2025, funding has become more selective, concentrating on fewer, more mature firms, with the UK ranking second globally for disclosed investment. It highlights a shift in the key challenge faced by firms, from product development to understanding how regulation applies to them, with demand for FCA support increasing significantly. This includes a 49% rise in applications to the Regulatory Sandbox and Innovation Pathways in 2025, particularly in relation to AI, distributed ledger technology, and open banking and open finance. In the report, the FCA also summarises steps taken in 2025 to expand its innovation services. Looking ahead, the FCA signals a focus in 2026 on clearer guidance, more structured testing pathways, broader engagement with incumbent firms, and supporting UK competitiveness and international growth.

The UK Financial Conduct Authority (FCA) has published findings from its multi‑firm review examining the impact of market soundings on market quality in UK equity capital market (ECM) transactions. The review analysed data from 63 UK equity and equity linked transactions conducted by five wholesale banks between January 2023 and June 2025. The FCA found that trading volumes fell by an average of 13% during market sounding periods but did not observe material impacts on other market quality metrics, including effective and quoted spreads and market depth. On average, 33 investors were market sounded per transaction, with one instance approaching nearly 90 recipients; however, transactions that sounded above average numbers of recipients did not meaningfully increase overall demand or oversubscription after launch.

While the FCA does not prescribe limits on the number of market sounding recipients, it notes that the risk of inside information leakage may increase as the scale or duration of a market sounding grows and suggests firms consider whether their policies and procedures adequately reflect this. The FCA will continue to engage with banks and other market participants through supervisory work. In addition, the FCA sought feedback on Article 11 of the UK Market Abuse Regulation (MAR) with some banks suggesting improvements, including closer alignment with the EU market soundings regime and reduced record keeping requirements. The FCA will consider this feedback when assessing any future changes to UK MAR.

The legislative package reforming the crisis management and deposit insurance (CMDI) framework for banks in the EU was published in the Official Journal of the European Union (OJ). The package includes targeted amendments to: (i) the Bank Recovery and Resolution Directive (BRRD) regarding early intervention measures, conditions for resolution and funding of resolution action and Directive 2014/24/EU, regarding valuation services in resolution; (ii) the Single Resolution Mechanism Regulation (SRMR) regarding early intervention measures and conditions for resolution and funding of resolution action; and (iii) the Deposit Guarantee Schemes Directive (DGSD) regarding the scope of deposit protection, use of deposit guarantee schemes funds, cross-border co-operation, and transparency.

The reforms aim to strengthen the EU's ability to manage bank failures, including small and medium-sized banks, by facilitating access to industry-funded safety nets, such as national resolution funds and the Single Resolution Fund. These tools are intended to supplement a failing bank's own loss-absorbing capacity, thereby reducing reliance on taxpayer-funded bailouts, referred to as the "bridge the gap" mechanism. The transposition deadline for amendments to the two directives is 11 May 2028. The amendments to the SRMR and DGSD are to apply (with some exceptions) from 11 May 2028 and the amendments to the BRRD from 12 May 2028.

The UK Prudential Regulation Authority (PRA) has published consultation paper CP7/26, setting out proposed regulated fees and levies for 2026/27. The PRA proposes a total funding requirement of GBP346.6 million, a 1% decrease from 2025/26, which includes an annual funding requirement (AFR) of GBP329.3m. The AFR is the budgeted cost of ongoing regulatory activities and a 7% decrease from 2025/26, but may need to be revised when final estimates for costs are available.

The proposals include fee rates to meet the AFR; an increased cost allocation for the Future Banking Data programme; inflation-linked increases to internal model application, model maintenance and restructuring project fees; and changes to new firm authorisation fees. The PRA also sets out its proposed approach to allocating an estimated GBP2m surplus from 2025/26. The deadline for comments is 15 May. The PRA proposes to implement the changes from 13 July, except for the new internal model application fee and the model maintenance fee for calculating exposure values for securities financing transactions under the value-at-risk approach. This would take effect from the Basel 3.1 implementation date of 1 January 2027.

The Bank of England (BoE) has published a consultation paper setting out its proposed fees regime for the supervision of financial market infrastructures (FMIs) for 2026/27.

Key proposals include a 3.2% reduction in UK central counterparties (CCPs) fees (excluding rulebook costs) and a 7.7% increase in UK central securities depositories (CSDs) fees to reflect work on repealing and replacing UK CSDR. The BoE intends to work with the UK Financial Conduct Authority and HM Treasury (HMT) to publish a full roadmap later this year on the repeal and replacement of UK CSDR, including a permanent regime for digital securities settlement.

In addition, the BoE proposes to maintain the UK CCP rulebook development costs, keeping the 2026/27 recovery instalment at GBP1.5 million, with any excess costs to be recovered in 2027/28. Fees for non‑UK CCPs and CSDs would be broadly unchanged, with small reductions for certain categories.

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The UK Prudential Regulation Authority (PRA) has published its business plan for 2026/27, setting out its regulatory and supervisory priorities for the year ahead.

The PRA's strategic priorities include:

• Maintaining the safety and soundness of the banking and insurance sectors, and ensuring continued resilience, with a focus on embedding major reforms such as Basel 3.1 and the small domestic deposit takers regime, as well as enhanced operational resilience and cyber risk management.
• Being at the forefront of identifying new and emerging risks, including those arising from geopolitical developments, economic and financial market developments and the evolving use of AI. The PRA will also continue to support the Basel Committee on Banking Supervision's targeted review of the prudential treatment of cryptoasset exposures and monitor sector-wide resilience while maintaining international and bilateral engagement.
• Supporting competitive, dynamic and innovative markets, while facilitating international competitiveness and growth through streamlined reporting (via the Future Banking Data programme) and tailoring support for fast-growing and innovative financial firms through its new scale-up unit and the concierge service for new inbound international firms.
• Running as an inclusive, efficient and responsive regulator within the Bank of England and increasing its adoption of emerging technology tools to improve its regulatory processes for firm authorisations, the Senior Managers and Certification Regime, internal model permission application and approvals.

The business plan sets out more detailed initiatives under each strategic priority.

The European Banking Authority (EBA) has published its response to the European Commission's (EC) targeted consultation on the competitiveness of the EU banking sector. The EBA emphasises the importance of completing and deepening the single market and the banking union as key drivers of competitiveness. It also highlights the resilience of EU banks strengthened by the post‑financial crisis reforms, while noting ongoing challenges including geopolitical risks, exposures to non‑bank financial institutions and digital transformation.

Building on the findings from its October 2025 report on the efficiency of the regulatory and supervisory framework (which put forward 21 recommendations to simplify the banking rulebook) the EBA emphasises that competitiveness can be enhanced through targeted simplification. It states that such efforts should respect principles of: maintaining financial stability and credibility through continued commitment to Basel III standards; enabling banks to fully benefit from the single market while preserving and deepening it and the banking union; and ensuring an EU wide level playing field— applying proportionality where appropriate to avoid the fragmentation of the rulebook. The EBA confirms it will continue to work closely with the EC to support a competitive, resilient and stable EU banking sector.

The European Commission (EC) has adopted a Delegated Regulation supplementing the Capital Requirements Regulation (EU) No 575/2013 (CRR), as amended by the CRR3. It sets out regulatory technical standards (RTS) specifying what constitutes an equivalent legal mechanism to ensure that a residential property under construction is completed within a reasonable timeframe. The Delegated Regulation is based on the European Banking Authority's final draft RTS published in August 2025. Article 124 of the CRR sets out the requirements for assigning risk weights to exposures secured by mortgages on immovable property, including conditions under which exposures to properties under construction may qualify for preferential treatment. The EC has the power under Article 124(14) to specify what constitutes an equivalent legal mechanism to ensure that the property under construction is completed within a reasonable timeframe.

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The International Organization of Securities Commissions (IOSCO) and the Committee on Payments and Market Infrastructures (CPMI) have published a joint report setting out their findings of their level 2 assessment of the UK's implementation of the principles for financial market infrastructures (PFMI). These principles set expectations for the design and operation of key FMIs in order to enhance their safety and efficiency and, more broadly, limit systemic risk and foster transparency and financial stability. The report sets out the conclusions and recommendations of whether, and to what degree, the UK legal, regulatory and oversight frameworks applied to systemically important payment systems (PSs), central securities depositories (CSDs) and securities settlement systems (SSSs), as of 30 September 2023.

The report finds that the UK legal, regulatory and oversight frameworks for PSs are complete and consistent with all principles under the PFMI, while the UK legal, regulatory and oversight frameworks for CSDs and SSSs are complete and consistent in most aspects, with some areas for improvement where implementation was broadly or partly consistent or not consistent. For UK CSDs and SSSs that provide banking-type ancillary services, the framework was consistent with 15 principles, broadly consistent with five principles (that is, principles 9, 11, 15, 16 and 23) and not consistent with principle 10. For other UK CSDs and SSSs, additional gaps relating to principles 4 and 7 were found, where implementation was partly consistent.

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The EU Authority for Anti‑Money Laundering and Countering the Financing of Terrorism (AMLA) has launched two consultations on draft measures setting out requirements for business‑wide risk assessments (BWRAs) and group‑wide anti-money laundering and countering the financing of terrorism (AML/CFT) frameworks under the EU Anti‑Money Laundering Regulation (AMLR).

The first consultation specifies draft regulatory technical standards (RTS) under Articles 16(4) and 17(3) of the AMLR, setting minimum standards for the design and implementation of group‑wide AML/CFT frameworks. They address organisational aspects of group wide AML/CFT requirements, provisions on information sharing within groups, criteria for identifying the parent undertaking in the Union where multiple obliged entities are linked to a third country head office, and the extension of group wide requirements to structures other than groups (which is particularly relevant to the non financial sector). The draft RTS also cover additional measures and requirements where branches or subsidiaries operate in third countries. AMLA proposes a single set of RTS to cover both Article 16(4) and Article 17(3) mandates. The deadline for comments is 15 June, with a public hearing scheduled for 20 May. Feedback will be considered with the final draft RTS due to be submitted by 30 September.

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The UK Financial Conduct Authority (FCA) has published a blog post discussing the findings from firms' year 2 consumer duty board reports and what firms can do now to help them prepare for the next round of reporting in Q3. Under the consumer duty, firms must report annually on what their monitoring found about customer outcomes, and what actions they will take as a result. The FCA notes that while firms have improved, further progress is needed ahead of the third reporting cycle.

The FCA observed stronger governance and board oversight, including more formal board review and approval of reports, better action plans and ownership, and wider use of quantitative and qualitative data to demonstrate customer outcomes. There is also more evidence of firms improving how they identify and monitor outcomes for vulnerable customers. However, the FCA notes that the quality and depth of analysis was variable.

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The European Securities and Markets Authority (ESMA) has launched a call for evidence on the purposes, market practices, needs and risks associated with restricted subscription and private credit ratings. In particular, ESMA seeks views on:

• The characteristics and use cases of restricted subscription and private credit ratings, including their benefits compared with publicly disclosed ratings.
• The characteristics of the parties who are contracting for restricted subscription and private credit ratings and those to whom they are disclosed or distributed.
• Evidence on whether, and to what extent, the analytical processes, governance arrangements, and internal controls applied to restricted subscription and private credit ratings are comparable to those applied to public credit ratings.

ESMA requests evidence-based responses, including quantitative information where available, as well as concrete examples drawn from market practice. The deadline for comments is 31 May. Responses will be reviewed in Q2 with a view to assessing whether specific regulatory adjustments or clarifications may be needed to enhance clarity on the application of the Credit Rating Agencies Regulation (EC) No 1060/2009.

The UK Financial Conduct Authority (FCA) has published policy statement PS26/5, setting out its new rules and final statement of policy for the UK short selling regime. In addition, the FCA published an operational guide to provide more detailed information on the operational changes required and the timeframe for implementation. This follows the introduction of the Short Selling Regulations 2025 (SSR 2025) under the Financial Services and Markets Act 2023 and the October 2025 consultation on the draft rules. The FCA has created a new Short Selling Sourcebook within its Handbook, to consolidate existing requirements and to introduce targeted changes to reduce regulatory burdens and improve market efficiency. Following consultation feedback, the FCA's final rules make further changes in the following areas to provide additional clarity and enhance its proposals:

• Removing the requirement for market makers to notify each financial instrument they want to benefit from the market maker exemption. They will only be required to submit a single "activity based" notification which will enable them to use the exemption for market making activities in any financial instrument. Market makers must also submit an "annual attestation" to demonstrate their compliance with the conditions to use the exemption.
• Considering, as part of its forthcoming review of the disclosure guidance and transparency rules (DTRs), whether the existing disclosure framework in DTR 5 could be used or adapted to require issuers to publish issued share capital specifically for short selling purposes.

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The UK Financial Conduct Authority (FCA) has published consultation paper CP26/13, proposing changes to the Perimeter Guidance Manual (PERG) within the FCA Handbook to clarify the scope of the new regulated cryptoasset activities and when permissions will be required. In addition, the consultation paper aims to provide clarity for firms transitioning from the FCA's current cryptoasset regime (under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017) (MLRs) to the new cryptoasset activities under the Financial Services and Markets Act 2000 (FSMA).

The proposed new chapter in PERG will contain guidance on how to determine whether an activity is within the perimeter, and guidance on the new specified investments and new regulated cryptoasset activities, including which permissions may be required for certain business models and how specific exclusions operate and other related issues. The FCA also clarifies that, as outlined by HM Treasury in the explanatory memorandum accompanying the Cryptoasset Regulations 2026, FSMA authorised cryptoasset firms will not need to register as "cryptoasset exchange providers" or "custodian wallet providers" under the MLRs but instead will only need to notify the FCA. However, these firms will still need to comply with the MLRs. The proposed guidance in full is set out in the draft Perimeter Guidance (Regulated Cryptoasset Activities) Instrument 2026, in Appendix 1 of the consultation paper.

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The UK Office of Financial Sanctions Implementation (OFSI) has published its strategy for 2026–2029. The strategy is based around the "Promote, Enable, Respond and Change" (PERC) framework:

• Promote: To shape expectations and set the standard, OFSI will run targeted campaigns for priority sectors; publish clear guidance products and assessments showing what non-compliance is and how to avoid it; and work with domestic and international regulators to promote consistency. "Promote" key performance indicators (KPIs) include sector-specific engagement campaigns and delivering joint or co-branded public output (such as joint guidance, public statements, case studies or advisories) with international partners on a quarterly basis.
• Enable: OFSI will remove friction for legitimate activity and support sanctions compliance behaviour that is fast, predictable and scalable by encouraging early engagement from firms to address risks or uncertainties, providing direct, practical compliance advice on complex scenarios, and maintaining an effective and regularly updated licensing offer with high, publicised service standards. Engagement will be modern and digital by default, including online services, reporting and forms, supported by enhanced data use, data sharing and AI enabled workflows. The "enable" KPI is to close 50% of licensing cases within six months.

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The Single Resolution Board (SRB) has published its response to the European Commission's (EC) targeted consultation on the competitiveness of the EU banking sector. The SRB emphasises that while the banking union has substantially strengthened the resilience of EU banks, its incomplete nature continues to hinder cross-border integration and efficiency.

The SRB highlights the need for progress towards a more integrated European deposit protection framework, a strengthened and more predictable approach to liquidity in resolution, and improvements to the cross border allocation of capital and liquidity within banking groups, supported by robust resolvability safeguards. It also calls for targeted simplification of the regulatory framework, including greater coherence across prudential, resolution and macroprudential requirements and streamlined minimum requirement for own funds and eligible liabilities processes, while maintaining overall resilience and financial stability. The SRB states that these measures would support both market integration and the international competitiveness of EU banks, and confirmed its intention to continue engaging with the EC as it develops its policy response.

The European Central Bank (ECB) has published its Governing Council's response to the European Commission's targeted consultation on the competitiveness of the EU banking sector. The response builds on the ECB's High-Level Task Force (HLTF) simplification proposals, endorsed by the ECB in December 2025. The response and proposals are endorsed by all euro area central banks.

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The European Commission has adopted a Delegated Regulation supplementing Directive 2014/65/EU (MiFID II), with regard to regulatory technical standards (RTS) specifying the criteria to be taken into account by investment firms when establishing and assessing the effectiveness of their order execution policies. The Delegated Regulation is based on ESMA's final draft RTS published in April 2025. The RTS specify rules on, among other things: (i) selecting execution venues; (ii) monitoring investment firms' execution policies; (iii) order routing; (iv) the handling of specific client instructions and related investor protection safeguards; (v) the periodic assessment of investment firms' order execution policies; and (vi) how to identify classes and subclasses of financial instruments for which the investment firms execute orders on behalf of clients.

When the Delegated Regulation enters into force, it will repeal Delegated Regulation (EU) 2017/575 which sets out data to be published by execution venues on the quality of execution of transactions on their venues and Delegated Regulation (EU) 2017/576, which sets out obligations for investment firms to publish information on the identity of execution venues and the quality of execution obtained. The Delegated Regulation will enter into force on the 20th day following its publication in the Official Journal of the European Union. It will apply 18 months after entry into force, allowing firms time to update their order execution policies, procedures and systems.

The UK Financial Conduct Authority (FCA) has published its open finance roadmap, setting out its vision for open finance in the UK from now until 2030. The FCA explains that the roadmap draws on lessons from open banking and international experience and takes a phased evidence-led and collaborative approach.

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The European Securities and Markets Authority (ESMA) has published a webpage with official translations of its guidelines on the periodic information that benchmark administrators, credit rating agencies (CRAs), data reporting services providers and market transparency infrastructures must submit to ESMA. The guidelines repeal and replace ESMA's previous 2019 guidelines on the submission of periodic information by CRAs, together with its previous 2021 guidelines on periodic information and notification of material changes to be submitted to ESMA by trade repositories. The guidelines have applied since 1 January 2026. They clarify the format and frequency of the different categories of information which ESMA expects to receive in its role as supervisor, as well as harmonising and simplifying periodic reporting by these entities. The related final report was originally published in June 2025.

The UK government, through the UK Office of Financial Sanctions Implementation (OFSI), has updated its webpage, extending the deadline for responses to its call for evidence on the application of the ownership and control test under the UK Financial Sanctions Regulations. The deadline for responses has been extended from 11:59pm on 13 April to 11:59pm on 20 April.

The European Securities and Markets Authority (ESMA) has published the reporting templates and instructions for the active account requirement (AAR) under the revised European Market Infrastructure Regulation (EMIR 3). The new templates set out in detail how entities subject to the AAR should report the required information to their competent authorities. They cover counterparty information, activities and risk exposures, the representative obligation and declaration on operational conditions. The instructions are designed to ensure a consistent, structured and standardised collection of supervisory data. The first AAR reporting submission is expected on 31 July, covering the period from 25 June 2025 (when the AAR became applicable) to 30 June 2026. After the first reporting submission, reporting will take place every six months, with submissions due on 31 January and 31 July each year, each covering a twelve month reference period.

The Bank of England (BoE) has published new and updated guidance on how it could implement the UK's resolution regime in the event of a bank failure. The guidance includes:

• A new operational guide to transfer resolution. This new guidance provides clarity on how the BoE might execute a transfer resolution. This could include a scenario where some or all of a failing firm's business is transferred to a private sector purchaser, or to a temporary BoE owned bridge bank, and includes how it may require a recapitalisation payment. The guide also expands on the use of resolution powers to execute sales in bank failure scenarios.
• An updated operational guide to bail-resolution. This updated guidance sets out information on how the BoE could execute a bail-in resolution under the Banking Act 2009. The key addition in this updated guidance is the introduction of an alternate approach to bail-in where affected creditors receive non-transferable contingent beneficial interests. These interests simplify the bail-in process and represent a potential right to shares, or proceeds from the sale of shares, once the resolution is concluded. These interests would be created upon entry into resolution and exist until the share allocation for relevant creditors is finalised.

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The European Banking Authority (EBA) has published a report analysing the recovery plan submissions of 16 European cross-border banking groups, whose parent institutions are located in ten different EU countries, with a particular focus on the practices observed in relation to recovery plan so-called 'dry runs'. The exercise aims to inform institutions' future designs of recovery plan dry runs and contribute to the development of useful benchmarks for their implementation—it is not intended to provide prescriptive guidance.

The analysis confirms that, although recovery plan dry runs are not explicitly covered in the regulatory framework, they are a highly effective tool for enhancing the operationalisation of recovery plans and strengthening institutions' overall crisis preparedness frameworks. Most institutions recognise their value; however, approaches and levels of maturity vary significantly across institutions. Where dry runs are carried out primarily to meet supervisory expectations, they tend to be less effective, resembling compliance exercises with limited insights and follow-up actions. In contrast, institutions with more advanced practices use dry runs as genuine management tools, fully embedding recovery planning within their broader risk management framework. In these cases, dry runs strengthen internal preparedness by enhancing the credibility, feasibility and organisational understanding of recovery planning arrangements.

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The European Banking Authority (EBA) has announced a series of measures, including publishing two consultation papers, to simplify the supervisory reporting framework under the EU Capital Requirements Regulation (CRR). The aim is to deliver a simpler, smarter and more proportionate framework. The deadline for comments on both consultation papers is 10 July, except for IFRS 18-related changes in FINREP in the first consultation, where the deadline is 10 May. 

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The European Banking Authority (EBA) has published a decision dated 1 April, harmonising how national competent authorities (NCAs) report data under the SEPA Regulation (EU) No 260/2012. Under Article 15(3) of the SEPA Regulation, payment service providers (PSPs) are required to report annually on charges for credit transfers and payment accounts, as well as the shares of transactions rejected due to EU sanctions. Under Article 15(4) of the SEPA Regulation, NCAs must currently share that information with both the European Commission (EC) and the EBA. To avoid double reporting, the decision provides that NCAs will now report this information only to the EBA, via a single reporting channel, on an annual basis by 9 October of each year. The EBA will then make this information available to the EC via its data collection ecosystem, the European Centralised Infrastructure of Data (EUCLID), as soon as possible after receiving it from the NCAs. The decision also clarifies that where NCAs already hold some of the required data, they are responsible for ensuring its accuracy and completeness, without re collecting it from PSPs. In addition, the Annex to the EBA's EUCLID Decision is amended to reflect this new reporting requirement. The decision takes effect immediately.

The final report from the Risk Warnings Review has been published. The report was commissioned by HM Treasury as part of the Leeds Reforms and sets out recommendations to improve the communication of investment risk to retail consumers.

The report advises moving away from the widespread use of standardised risk warnings which may be misunderstood by less experienced investors and disregarded by more experienced investors. Instead, it recommends rebalancing risk communications towards clearer, more contextual explanations of how investments can rise and fall, presented alongside potential benefits and relevant time horizons, which are seen as more likely to encourage positive actions.

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The UK Financial Conduct Authority (FCA) has published findings from authorisation applications received from firms seeking to operate in the asset management sector, setting out examples of good and poor practice for firms.

Key findings include:

• Office location: The FCA expects day-to-day management decisions to be taken in the UK. The FCA noted concerns where key decision makers were unable to do so without overseas approval, or were managed by offshore senior managers.
• Outsourcing: Firms are expected to show accountability for compliance with relevant rules when outsourcing activities to third parties. Some firms demonstrated this using service level agreements to oversee and monitor activities.
• Business models: Firms are expected to assess the full risk of their activities to consumers, including compliance with the consumer duty when dealing with retail clients. Some firms failed evidence this, with some business models posing an unacceptably high level of risk, particularly to retail clients.
• Conflicts of interest: There were mixed findings around firms' ability to demonstrate conflicts identification and management through maintaining registers and documenting reviews.

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The European Banking Authority (EBA) has announced that it will regularly publish a list of known issues relating to the data point model (DPM) framework, with the aim of enhancing transparency and supporting reporting institutions. The list will serve as a single reference point for recurring technical issues. This is part of the EBA's broader simplification efforts to support the implementation of reporting requirements and reduce unnecessary operational burden, while maintaining data quality and supervisory objectives. The list published on 9 April covers issues relating to pillar 3 disclosures and resolution planning reporting.

The European Banking Authority (EBA) has launched a consultation on revised guidelines on limits on exposures to shadow banking entities (SBEs) carrying out banking activities outside a regulated framework, under Article 395(2) and (2a) of the Capital Requirements Regulation (CRR). The proposed revisions update the 2015 Guidelines to align with the harmonised CRR framework introduced by Commission Delegated Regulation (EU) 2023/2779, which now provides binding and maximum harmonised criteria for identifying SBEs. Accordingly, definitions and scoping elements previously contained in the guidelines have been removed, including the 0.25% materiality threshold, to ensure consistency with CRR reporting and disclosure requirements.

The guidelines retain their core purpose of setting supervisory expectations on how institutions should manage and monitor their exposures to SBEs to ensure that risks arising from such exposures are properly identified, measured, limited and controlled. They preserve existing governance requirements and the primary and fallback methods for setting exposure limits. No new quantitative limits are to be introduced at this stage. Input gathered through the consultation will inform the finalisation of the guidelines and broader EBA policy work, including a report on the contribution of SBEs to the capital markets union and an assessment of institutions' exposures and limits, expected by December 2027. The deadline for comments is 9 July, with a virtual public hearing scheduled for 25 June.

The Network for Greening the Financial System (NGFS) has released a new package of materials aimed at supporting central banks and supervisors in assessing and managing nature‑related financial risks. The package builds on the NGFS' 2024 Conceptual Framework and comprises three complementary notes covering: (i) nature‑related data, including guidance on identifying and prioritising relevant data sources and metrics, and the use of case studies and AI to improve data quality and availability; (ii) modelling tools for nature scenarios, highlighting current limitations in capturing interactions between nature, climate and the economy and setting out core design principles for future NGFS scenarios; and (iii) supervisory practices, proposing a pragmatic four‑step approach that builds on existing climate supervision and addresses current limitations. It offers a pathway towards a more integrated climate-nature prudential framework.

The European Central Bank (ECB) and the European Systemic Risk Board (ESRB) have published a joint report on the usability of capital buffers. The report analyses how prudential and resolution frameworks interact, and how this interaction may limit buffer usability.

Key takeaways include:

• Prudential and resolution frameworks are distinct but complementary. Their interaction is complicated. In particular, the report notes that the way common equity tier capital may be used to satisfy multiple requirements may limit its ability to absorb losses.
• In addition to the double-counting of capital, resolution frameworks can impact buffer usability when authorities use their discretionary powers to apply restrictions relating to the maximum distributable amount related to MREL.
• To evaluate the macroprudential impact of the relationship between the frameworks, a consistent methodology is needed. In line with this, the report defines the following key concepts: buffer usability; releasability; capital headroom; and loss-absorption capacity. It also provides a methodology for quantifying and evaluating these concepts. In addition, the report has developed the analytical framework, and updated the buffer usability simulation tool which has been used by national authorities in recent years.

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The UK Financial Conduct Authority (FCA) has published findings of a multi‑firm review of customer due diligence (CDD), enhanced due diligence (EDD) and ongoing monitoring controls, setting out examples of good and poor practice for firms. The FCA assessed CDD systems and controls through a questionnaire, a desk-based review of policies and procedures, customer file reviews and interviews with staff at firms.

Key findings include:

• Policies and procedures: Stronger firms demonstrated clear distinctions between standard CDD and EDD, applying risk based approaches to higher risk customers, including politically exposed persons. However, weaknesses included unclear guidance on additional EDD measures, review frequency and how staff should identify and verify customers who cannot provide standard forms of identification. In some cases, firms failed to follow their own policies and procedures, including in relation to periodic customer reviews.

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The European Commission (EC) has adopted two Delegated Regulations under the Market Abuse Regulation No 596/2014 (MAR) to reflect amendments introduced by the Listing Act (Regulation (EU) 2024/2809).

The first Delegated Regulation sets out requirements on the disclosure of inside information in protracted processes, including the conditions and arrangements for the delay of disclosure. Under Article 17(1) of MAR, issuers must disclose inside information as soon as possible, although Article 17(4) permits delayed disclosure in certain circumstances. The Listing Act amended this regime by excluding intermediate steps in protracted processes from disclosure, provided confidentiality is maintained, and by clarifying when disclosure may be delayed. The Delegated Regulation sets out non exhaustive lists of: (i) final events or circumstances that trigger disclosure along with the timing of such disclosure; and (ii) situations where there is a contrast between inside information whose disclosure is intended to be delayed, and the most recent public announcement or communication by the issuer or emission allowance market participant on the same subject. The Regulation will enter into force on the third day following its publication in the Official Journal of the European Union (OJ).

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The UK Financial Conduct Authority (FCA) has published Primary Market Bulletin 62. The bulletin highlights concerns about potentially manipulative investment approaches affecting micro-cap and small-cap issuers' share prices, specifically an increase in: (i) fake investor approaches, where parties pose as genuine investors and leak news of a supposed takeover or push disclosure of the approach to the market to inflate share prices; and (ii) equity fundraisings linked to pump and dump schemes, often involving the issuance of large numbers of warrant instruments. Warrants are then exercised and the shares sold at the increased share price. The FCA emphasises the importance of robust due diligence by quoted companies and their advisers before engaging with investment proposals, including verifying investor identities, assessing whether proposals are genuine and reviewing investors' track records for similar transactions.

The FCA also provides feedback from its recent reviews of sponsors' work on the modified transfers process under the UK Listing Rules, sharing observations on due diligence, sponsor judgement and compliance with eligibility requirements. The FCA states it is encouraged to see the modified transfers process being used and sponsors applying their expertise and judgement.

In addition, the FCA notes the deadline of 20 April for responding to its consultation on proposed clarificatory amendments to the Prospectus sourcebook (PRM), in chapter 5 of the FCA's Quarterly Consultation Paper No. 51.

The UK Financial Conduct Authority (FCA) and the Bank of England (BoE) have opened the application window for prospective members of a new UK transaction and post-trade reporting taskforce. The purpose of the taskforce is to inform the UK's long‑term approach to harmonising transaction and post‑trade reporting requirements across regimes including the UK Markets in Financial Instruments Regulation (UK MiFIR), the UK European Market Infrastructure Regulation (UK EMIR) and the UK Securities Financing Transactions Regulation (UK SFTR). It is intended that the taskforce will run for 18 months, after which the position will be reviewed. Further detail is set out in the terms of reference for the taskforce.

The taskforce will comprise three working groups: a main policy group which will focus on opportunities for harmonisation and simplification, a strategy group which will provide insight from industry experience, and an architecture group, which will explore opportunities to leverage modern technologies. The FCA and the BoE will co-chair the working groups, which are expected to meet every two months or more often if needed. The deadline for applications is 23 April.

The UK Financial Conduct Authority (FCA) has published an updated webpage with newly issued directions, setting out the process for firms to register for the temporary permission regime (TPR) for deferred payment credit (DPC), formerly known as buy now, pay later. The directions came into force the same day.

DPC will be regulated by the FCA from 15 July ("regulation day"). Firms which were carrying on DPC activity on 15 July 2025 may continue operating under the TPR while their authorisation applications are considered. To enter the TPR, firms must notify the FCA using the prescribed form during the notification window, which runs from 15 May to 1 July, and pay the registration fee of GBP280. Firms granted temporary permission will be able to submit their substantive authorisation applications from 8 July.

Firms that were not carrying on DPC activity on 15 July 2025, or do not intend to continue after regulation day, do not need to register. Firms without authorisation or temporary permission may also continue to service DPC agreements that were taken out before regulation day as these agreements will remain exempt.

The UK Financial Ombudsman Service (FOS) has published its response (dated February) to the FCA's Mills Review on the long‑term impact of AI on retail financial services. The response focuses on two areas: the increasing use of AI by consumers and professional representatives in complaint submissions; and financial firms' use of AI.

The FOS observes an increase in consumers using AI, noting that AI can help consumers organise complaints, overcome language barriers and present clearer cases—especially consumers who are vulnerable and have difficulty expressing themselves in writing. However, there are also concerns where generative AI is used excessively or inaccurately, leading to lengthy, incoherent submissions and "hallucinations". The FOS reports early indications from a small sample analysis that AI may have contributed to around 35% of responses to initial assessments, which can lead to a disproportionate amount of time spent on verifying accuracy. The FOS welcomes the FCA's focus on AI in retail financial services and calls for consistent guidance to firms and consumers as AI use evolves in the complaint process, offering to provide its own insights to support this work.

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