European Banking Authority launches consultation on revised SREP and supervisory stress testing guidelines

The European Banking Authority (EBA) has launched a public consultation on revised Guidelines for common procedures and methodologies for the supervisory review and evaluation process (SREP) and supervisory stress testing, aiming to simplify and improve the efficiency of the EU supervisory framework while maintaining risk-focused supervision. The draft updates revise all main SREP elements, clarify the ongoing nature of SREP, and strengthen proportionality based on the proportionality peer review and recommendations from the EBA’s Advisory Committee on Proportionality. The revised Guidelines incorporate new CRD VI mandates on the output floor and third-country branches, align with the interest rate risk in the banking book (IRRBB) and credit spread risk arising from non-trading book activities (CSRBB) package, and embed ESG factors and operational resilience considerations. They also reflect lessons from applying the SREP Guidelines since 2016, including a clearer link between assessment areas and supervisory measures with a high-level escalation framework, streamlined but enhanced liquidity and funding assessments, clearer communication of SREP outcomes, and an expanded ICT risk focus by incorporating the Digital Operational Resilience Act (DORA) framework and merging content from existing ICT risk assessment guidelines under SREP that would be repealed once the revised Guidelines enter into force. Comments are due by 26 January 2026. A virtual public hearing is scheduled for 4 December (10:00 to 12:00 Paris time), with registration requested by 1 December (16:00 CET).