The European Banking Authority (EBA) launched a consultation on 7 May 2026 proposing amendments to the Regulatory Technical Standards (RTS) that govern how banks assign risk weights to specialised lending exposures under the Supervisory Slotting Criteria Approach. The changes aim to align the framework with the latest Basel III standards and address inconsistencies in the current treatment of project finance, object finance, commodities finance, and income-producing real estate.
The consultation document, published by the EBA, sets out revised slotting criteria that would recalibrate risk weights for certain specialised lending categories, potentially lowering capital requirements for well-performing exposures while increasing them for riskier ones. The EBA also proposes to harmonise the definition of default across specialised lending and to introduce more granular supervisory categories. The amendments are intended to improve risk sensitivity and reduce regulatory arbitrage, but they could increase compliance costs for banks that use internal models for these exposures.
Stakeholders impacted Banks active in project and infrastructure finance would face the most significant changes. Under the current rules, many specialised lending exposures benefit from relatively low risk weights under the slotting approach. The proposed recalibration could raise capital charges for some categories, particularly for weaker credits, while providing relief for stronger ones. This may affect lending volumes in sectors such as renewable energy and transport infrastructure, where project finance is common.
National competent authorities would need to update their supervisory practices to reflect the new criteria, potentially requiring additional data collection and validation. Borrowers in specialised lending sectors could see changes in loan pricing and availability, depending on how banks pass on the capital cost adjustments.
Trade-offs in the proposal The EBA faces a trade-off between risk sensitivity and simplicity. More granular slotting criteria improve the alignment of capital with actual risk, but they also increase the complexity of the framework and the burden on banks to classify exposures correctly. The proposal also balances financial stability objectives with the need to support long-term investment: stricter capital treatment for weaker credits could discourage lending to higher-risk projects, while lower risk weights for strong credits could incentivise well-structured deals.
Expected institutional follow-up The consultation is open until 7 August 2026. The EBA will then finalise the draft RTS and submit them to the European Commission for endorsement as binding technical standards. The European Parliament and the Council have the right to object within a three-month scrutiny period. If adopted, the new rules would apply from 1 January 2028, with a transitional period for existing exposures.
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