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ECB finalises revisions to guide on options and discretions under EU banking law
25 July 2025The European Central Bank (ECB) has published an updated guide outlining its supervisory stance on the exercise of options and discretions provided for under the Capital Requirements Regulation (CRR) and the Capital Requirements Directive (CRD), in the context of prudential supervision of credit institutions. The guide seeks to provide coherence and transparency on the supervisory policies that will be applied in supervisory processes within the Single Supervisory Mechanism, particularly in supporting joint supervisory teams in their oversight of significant credit institutions. The update takes into account the latest revisions to the EU's CRD and CRR. The ECB has also published a feedback statement. A version of the guide with draft revision marks has also been released to clearly outline the changes made by the ECB in response to the consultation that ended in January.
To align the legal framework with the revised guide, the following were adopted by the ECB and have been published in the Official Journal of the European Union on 28 July: (i) Regulation (EU) 2025/1520 amending Regulation (EU) 2016/445 on the exercise of options and discretions available in Union law, which enters into force on 17 August; (ii) Recommendation of the ECB amending Recommendation ECB/2017/10 on common specifications for the exercise of some options and discretions available in Union law by national competent authorities (NCAs) in relation to less significant institutions; and (iii) Guideline (EU) 2025/1521 of the ECB amending Guideline (EU) 2017/697 on the exercise of options and discretions available in Union law by NCAs in relation to less significant institutions. The updated guide, recommendation and guideline apply with immediate effect, although member states are expected to apply the guideline from 1 January 2026.
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