CRD5/CRR2 and BRRD negotiations entered in their final phase

Negotiations on the EU’s bank capital legislation, the fifth Capital Requirements Directive and second Capital Requirements Regulation (CRD5/CRR2), plus changes to the Bank Recovery and Resolution Directive (BRRD), are now in their final phase. The European Council and Parliament have both now reached their respective positions on the files, and have begun ‘trilogue’ talks aimed at finding a common position.

What we are seeing at this stage of the talks is a number of very important differences between the Council and Parliament on key issues for banks. The outcome of these negotiations will determine how and when a broad range of regulatory standards are implemented in the EU and have direct implications for banks’ financial resources, perhaps most notably through the calibration of the Minimum Requirements for Own-funds and Eligible Liabilities (MREL) rules.