Publication
Date:
In recent years, supervisory authorities have intensified their expectations regarding internal governance across the European banking sector. The evolving regulatory landscape – most recently reflected in the EBA Consultation Paper on Internal Governance (EBA/CP/2025/20) – places greater focus on management accountability, risk culture, and the integrity of governance and control structures. Internal governance is a key element in promoting financial stability, institutional resilience, and trust in the banking system.
The updated framework builds on existing governance principles and expands their scope to include ESG oversight, ICT and AI-related risks, and the management of third-country branches. Hereby, the expectations on the risk management of third-country branches has been significantly expanded. Furthermore, the Draft Guildelines clarify the roles and responsibilities of management bodies, strengthens transparency in decision-making, and enhances the effectiveness of internal control functions.
Although institutions have made progress in developing governance practices since the financial crisis, the proposed amendments highlight the continued need for sound structures and clearly defined responsibilities. Supervisors expect consistent implementation across organisational levels and jurisdictions, in line with the principle of proportionality.
This publication presents a horizontal analysis of the proposed EBA amendments, outlines the main areas of change, and summarises practical implications for institutions.
