Brussels, 11 December 2025 – The European Banking Federation (EBF) welcomes European Central Bank (ECB) Governing Council report on the proposals for simplification of EU banking rules released earlier today. The EBF appreciates the recognition of the High-Level task force that EU-specific elements of banking rules need to be streamlined, and supports the intention to increase transparency and reduce uncertainty.

However, concrete and determined steps must now follow to enhance the global competitiveness of the EU’s financial sector, thereby unlocking essential financing for European families, businesses, and the wider economy.

The EBF comments on key elements of the report below.

• Number of elements in the risk-weighted and leverage ratio framework

The proposed reduction of capital stack elements, such as the merging of the capital buffers into two categories, is a step in the right direction.

EU policymakers should not hesitate to cut overlapping EU goldplating measures in their efforts to reduce complexity. EU banks must still carefully assess the proposed options regarding the capital stack. Nevertheless, any change should ensure that banks will not be worse-off – in terms of cost of funding – than peer jurisdictions, as this could negatively impact EU competitiveness and growth.

Additional complexity arises from the large number of authorities involved and the absence of clear and reliable coordination instruments between these authorities.

• Macroprudential Framework

The intent of the high-level task force to simplify the macroprudential framework through reciprocating measures and “shared responsibility” is well-received. In practice, shared responsibility only allows for incremental discretion of capital add-ons that can be topped-up, but cannot be capped. This remains a source of many EU capital inefficiencies that requires further scrutiny. More ambitious simplification measures could address these inefficiencies and make more efficient use of EU banks’ capital in support of EU competitiveness.

• Supervision

The EBF has called upon policymakers to enhance the Single Market for banking by creating more harmonised supervision across the Eurozone. Accordingly, we welcome a less prescriptive and more risk-based approach to supervision, and support the streamlining of the stress test methodology to reduce compliance costs and enhance the benefits of the exercise.

• Reporting

The EBF welcomes the various measures towards reducing the reporting burden and cost on institutions, and appreciates the ECB’s commitment to work towards a fully-harmonised EU-wide reporting system aligned with the EBF’s suggested reporting principles: define once, report once, share information, and enhance governance.

We look forward to deepening the close dialogue and collaboration with the ECB and other authorities, including on the Integrated Reporting Framework, which is the first concrete step towards EU-wide harmonisation of statistics, supervision and resolution data.

The European Banking Federation remains committed to continued cooperation with the ECB and all other EU authorities to drive forward the work on simplifying EU banking regulation. This effort is urgently needed to boost Europe’s competitiveness, particularly as a recent EBF study revealed that rising supervisory capital requirements have blocked in the last 3 years upwards of EUR 1.5 trillion in lending capacity that could have financed European growth.

Gonzalo Gasos, Senior Director, Prudential Policy & Supervision – g.gasos@ebf.eu