The European Banking Authority (EBA) published a press release on 29 April 2026 announcing a streamlined version of its Guidelines on connected clients, aimed at aligning the framework with recent EU legislative changes. The update impacts credit institutions and investment firms by simplifying the definition of connected clients used for large exposure reporting and capital requirements.
The revised guidelines reduce the complexity of identifying connected clients, which are groups of clients linked by control or economic interdependence. The EBA states that the changes ensure consistency with the updated Capital Requirements Regulation (CRR) and the Capital Requirements Directive (CRD), which introduced new provisions on large exposures and group-level supervision. The guidelines are non-binding but serve as a benchmark for competent authorities across the EU.
Key policy orientations The EBA's revision focuses on narrowing the scope of automatic connections based on control relationships, particularly for investment firms and smaller entities. The new guidelines also clarify the treatment of clients linked through common management or economic dependency, reducing the administrative burden for banks while maintaining prudential safeguards. The trade-off involves a slight increase in risk exposure for some institutions if connected client groups are underreported, but the EBA expects overall benefits from reduced compliance costs.
Impact on stakeholders Credit institutions: Banks benefit from lower compliance costs and simpler reporting, especially for large exposure calculations. However, they must adjust internal systems to the new definitions, which may require short-term investment. Investment firms: Smaller firms gain from reduced scope of automatic connections, easing their capital planning. The change may reduce their capital buffers for certain exposures. National competent authorities: Supervisors face a transitional period as they update their supervisory practices and ensure consistent application across member states. EU taxpayers: Indirectly benefit from a more efficient banking system with lower regulatory overhead, though the slight increase in risk tolerance may raise concerns about financial stability.
Expected institutional follow-up The EBA expects competent authorities to implement the guidelines within six months. The European Commission may monitor the impact as part of its broader review of the banking prudential framework. The EBA will also issue a final report on the consultation feedback in the coming weeks.
← Atlas › News › Industry, Innovation and Internal Market