European

European Commission adopts Commission adopts delegated regulation making temporary amendments to FRTB standards under CRR

On 4 June 2026, the European Commission adopted a delegated regulation introducing targeted, time-limited (up to three years) amendments to the revised prudential framework for market risk that was revised under CRR 3 (referred to as the ‘fundamental review of the trading book’ (FRTB) standards). The amendments have been adopted in response to continued uncertainty and delays in FRTB implementation in other major jurisdictions, including the UK and US, which risk placing EU credit institutions at a competitive disadvantage. While the application of the FRTB standards had already been postponed to 1 January 2027, the delegated regulation introduces temporary relief, most notably a “multiplier” mechanism to offset increases in market risk capital requirements, intended to preserve an international level playing field and mitigate capital impacts until 31 December 2029.  

A simplified EU-wide stress test, with climate risk integration, proposed by the EBA

On 11 June 2026, the European Banking Authority (EBA) published draft methodology, templates and template guidance for the 2027 EU-wide stress test, launching an early-stage consultation aimed at improving preparedness and transparency. The EBA says the 2027 exercise introduces significant simplifications to improve efficiency and risk sensitivity, while preserving the robustness and comparability of results. Key changes include a substantial reduction in data requirements, the alignment of information with harmonised supervisory reporting, and the integration of climate risks into the EU-wide stress test.

Date published: 30 June 2026

This publication provides an overview of certain legal and regulatory developments that may be of interest to certain entities. It does not purport to provide analysis of law or legal advice and is strictly for information purposes only.